U.S. Department of Agriculture
The Housing and Community Facilities Programs provides a number of homeownership opportunities to rural Americans, as well as programs for home renovation and repair. HCFP also makes financing available to elderly, disabled, or low-income rural residents of multi-unit housing buildings to ensure they are able to make rent payments.
The Single-Family Housing Program provides homeownership opportunities to low and moderate-income rural Americans through several loan, grant, and guarantee programs. The program also makes funding available to individuals to finance vital improvements necessary to make their homes decent, safe, and sanitary.
http://www.rurdev.usda.gov/rhs/
Direct Loan Program (Section 502)
Loan Guarantee Program (Section 502)
Mutual Self-Help Housing Program (Section 523)
Home Repair Loan and Grant Program (Section 504)
Farm Labor Housing Program (Section 514)
Rural Rental Housing Guaranteed Loan Program (Section 538)
Rural Rental Housing Program (Section 515)
Housing Preservation Grant (HPG) Program (Section 533)
Direct Loan Program (Section 502)
Under the Direct Loan program, individuals or families receive direct financial assistance directly from the Housing and Community Facilities Programs in the form of a home loan at an affordable interest rate.
Most of the loans made under the Direct Loan Program are to families with income below 80% of the median income level in the communities where they live. Since HCFP is able to make loans to those who will not qualify for a conventional loan, the HCFP Direct Loan program enables many more people to buy homes than might otherwise be possible. Direct loans may be made for the purchase of an existing home or for new home construction.
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Loan Guarantee Program (Section 502)
Under the Guaranteed Loan program, the Housing and Community Facilities Programs guarantees loans made by private sector lenders. The individual works with the private lender and makes his or her payments to that lender.
Under the terms of the program, an individual or family may borrow up to 100% of the appraised value of the home, which eliminates the need for a down payment. Since a common barrier to owning a home for many low-income people is the lack of funds to make a down payment, the availability of the loan guarantees from HCFP makes the reality of owning a home available to a much larger percentage of Americans.
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Mutual Self-Help Housing Program (Section 523)
The Mutual Self-Help Housing Program makes homes affordable by enabling future homeowners to work on homes themselves. With this investment in the home, or "sweat equity", each homeowner pays less for his or her home. Each qualified applicant is required to complete 65% of the work to build his or her own home.
Technical Assistance Grants and Site Loans are provided to nonprofit and local government organizations, which supervise groups of 5 to 12 enrollees in the Self-Help Program. Members of each group help work on each other's homes, moving in only when all the homes are completed.
Once accepted into the Self-Help Housing Program, each individual enrollee generally applies for a Single-Family Housing Direct Loan (Section 502).
Technical Assistance is provided to USDA Mutual Self Help programs by RCAC (Rural Community Assistance Corporation) in Idaho.
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Home Repair Loan and Grant Program (Section 504)
For very low income families who own homes in need of repair, the Home Repair Loan and Grant Program offers loans and grants for renovation. The Home Repair Program also provides funds to make a home accessible to someone with disabilities.
Money may be provided, for example, to repair a leaking roof; to replace a wood stove with central heating; to construct a front-door ramp for someone using a wheelchair; or to replace an outhouse and pump with running water, a bathroom, and a waste disposal system.
Homeowners 62 years and older are eligible for home improvement grants. Other low income families and individuals receive loans at a 1% interest rate directly from HCFP.
The Rural Housing Programs makes a variety of loans and grants to housing developers for the construction and renovation of multi-family housing facilities in rural areas. (In some cases, loans and grants are also made for the construction of single-family homes as well.)
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Farm Labor Housing Program (Section 514)
The Housing and Community Facilities Programs Farm Labor Housing program is the only nationwide program designed to provide housing for farm laborers. Loan funds may be used to buy, build, improve, or repair housing for farm laborers, including persons whose income is earned in aquaculture (fish and oyster farms) and those engaged in on-farm processing. Funds can be used to purchase a site or a leasehold interest in a site; to construct housing, day care facilities, or community rooms; to pay fees to purchase durable household furnishings; and to pay construction loan interest.
The Farm Labor Housing program is the only exception to the Housing and Community Facilities Programs rural service area. Funds may be used in urban areas for nearby farm labor.
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Rural Rental Housing Guaranteed Loan Program (Section 538)
This program is intended to fund construction, acquisition, or rehabilitation of rural multifamily housing for low-income occupants.
Residents of the completed housing facility must be very low- to moderate-income households; or elderly, handicapped, or disabled persons with income not in excess of 115% of the median income of the surrounding area.
The terms of the loans guaranteed may be up to 40 years, and the loans must be fully amortized. Rates of the loans guaranteed must be fixed, as negotiated between lender and borrower, within the maximum established under the Notice of Fund Availability (NOFA) HCFP publishes each year in the Federal Register.
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Rural Rental Housing Program (Section 515)
Rural Rental Housing Loans are direct, competitive mortgage loans made to provide affordable multifamily rental housing for very low-, low-, and moderate-income families; the elderly; and persons with disabilities. This is primarily a direct mortgage program, but its funds may also be used to buy and improve land and to provide necessary facilities such as water and waste disposal systems.
In new Section 515 projects, 95 percent of tenants must have very low incomes. In existing projects 75 percent of new tenants must have very low incomes.
Variations: There are four variations of the Section 515 loan program. They are Cooperative Housing, Downtown Renewal Areas, Congregate Housing or Group Homes for Persons with Disabilities, and the Rural Housing Demonstration Program.
Loans are for up to 50 years at an effective 1 percent interest rate. A current rate is used for the promissory note but thereafter is used only to determine maximum rent payments.
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Housing Preservation Grant (HPG) Program (Section 533)
Provides grants to sponsoring organizations for the repair or rehabilitation of low- and very low-income housing. The grants are competitive and are made available in areas where there is a concentration of need.
Those assisted must own very low- or low-income housing, either as homeowners, landlords, or members of a cooperative. Very low income is defined as below 50 percent of the area median income (AMI); low income is between 50 and 80 percent of AMI. Eligible sponsors include state agencies, units of local government, Native American tribes, and nonprofit organizations.
HPG funds received by the sponsors are combined with other programs or funds and used as loans, grants, or subsidies for recipient households based on a plan contained in the sponsor's application. Funds must be used within a two-year period.
The population limit of towns served is 20,000.
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