Would you love to make home improvements but find yourself short on cash? Don’t think you are out of luck just yet.
You may be eligible for a low-income housing repair loan or grant. The Rural Housing Repair Loans and Grants program helps homeowners make necessary home repairs and modifications in an affordable manner. If you qualify for a grant, it’s like free money. Ready to see how you may qualify?
What is the Low Income Repair Loan and Grant Program?
The USDA offers financial assistance to homeowners living in rural house that demonstrate financial need. Homeowners ages 62 and younger may qualify for a home repair loan, whereas homeowners over age 62 may qualify for a grant (no repayment required.)
How Does the Program Work?
The USDA provides loans of up to $20,000 with a term of 20 years and a 1% interest rate. Any loan over $7,500 requires full title work and must use your home as collateral. Homeowners can use the loan to repair, renovate, or even modernize your home.
If you are over 62 years old, you may be eligible for a grant up to $7,500 but only for mandatory repairs that remove health or safety hazards. If you sell the home in less than 3 years after receiving the grant, some or all of the money may be recaptured. You can combine both the USDA repair loan and grant for a total of $27,500 for home repairs.
Who Qualifies for the Low Income Housing Repair Loan and Grant?
Only certain homeowners qualify for the Low Income Housing Repair Loan and Grant:
- You must occupy the property full-time
- You must be able to prove you are ineligible for credit elsewhere
- Your household income must be less than 50% of the area’s median income
- The property must be located in an area the USDA determined as rural
Additionally, if you are over the age of 62, you must prove that you are unable to qualify for a repair loan.
How to Apply
Apply for your low-income housing repair loan or grant through your local Rural Development office where the house is located. The RD office offers two application options:
- Complete and send in the application yourself
- Get assistance from a Section 504 packager (nonprofit group from the USDA)
The turnaround time depends on the workload in your area. Ask your local RD office about their current turnaround time which can range from a few weeks to a few months.
The USDA helps those in rural housing renovate or repair their homes in an effort to keep homeowners in their homes while maintaining order throughout the community. Homeownership is good for individual homeowners as well as the economy itself – keeping homeowners in their homes helps stimulate the area’s economy, strengthening it for individuals as well as business owners. If you think you are eligible, contact your local RD office for more information on how you can get the funds you need for renovations or repairs.