Last Updated on January 27, 2023 by Anne-Sophie Reinhardt
This program, “Section 504 Home Repair”, provides loans for very low-income homeowners to fix, improve, or modernize their homes, and free grants to seniors and very low-income homeowners to eliminate safety and health hazards.
Existing Section 502 and Section 504 borrowers have been issued a payment moratorium in relation to COVID-19. The American Rescue Plan Act (ARP Act) of 2021 provided additional funds for Section 502 and Section 504 loans.
These funds will remain available until September 30, 2023. Refinances of Section 502 and Section 504 borrowers will be the main focus. The Agency will begin accepting applications from Section 502 and Section 504 loan borrowers to refinance loans that have been under a COVID-19 approved moratorium.
Free Grants For Homeowners Eligibility Requirements
- Has ownership of a house and live there
- Not be able to get affordable credit elsewhere
- A household income not exceeding the very lowest limit for each county.
- You must be at least 62 years old to be eligible for grants.
Eligible Rural Area
You can use the USDA Eligibility Website to enter a specific address or search the map for general eligible areas.
What You Need To Know About The Free Grants For Homeowners
What To Do With The Funding
You can borrow money to fix, upgrade or modernize your home or to remove safety and health hazards. You may also use it to remove safety and health hazards.
How Much Money Can I Get?
- Maximum loan is $40,000
- Maximum grant is $10,000
- Combination of Loans and grants up to $50,000 in assistance
What Are The Terms Of The Loans Or Free Grants For Homeowners?
- Loans are termed for 20 years
- Loan interest rate is fixed at 1%
- Full title service requirement if the total outstanding balance on Section 504 loans is greater than $25,000
- Grants have a lifetime limit of $10,000
- Grants need repayment if you sell the property in less than 3 years
- If applicants can repay part, but not all of the costs, applicants may have an offer of a loan and grant combination
Application Process Duration
The availability of funding in your area will affect the approval time. For assistance with your application, contact a USDA loan specialist in your region. Get in touch with a USDA loan specialist in your local area
Who Governs This Program?
- Housing Act of 1949, as amended 7 CFR Part 3550
- HB-3550 – Single-Family Housing Loans and Grants Field Office Handbook
Why Does USDA Rural Development Do This?
Families and communities benefit from helping people to stay in their homes and maintain it in good condition. Individuals and families can save money by becoming homeowners. It helps strengthen communities and supports many types of local businesses.