The United States Department of Agriculture Rural Development Agency has announced plans to help homeowners in need of essential repairs to their home through the assistance of low-interest loans.
“We currently have adequate loan funds for the Home Repair Loan Program,” said Angela Harvey, Area Technician in the Sedalia USDA office. “So now is a great time to use this opportunity to improve your home. “
USDA’s fiscal year ends Sept. 30 and there is funding available for this program.
To qualify for the program, applicants must own and occupy the home, the home must be in an eligible rural area, and the total household income cannot exceed the “very low” income guidelines established for each county and household size, according to a press release.
This program may be used to remove health and safety hazards such as repairing roofs, heating and air conditioning, electrical, plumbing, water/sewer systems, windows, insulation, or to make a home handicap accessible. It can also be used to improve or modernize a home.
“In order to qualify for the program properties must be located in an eligible rural area,” said Beverly Miller, Housing Program Specialist for Rural Development for the USDA. “The following website allows an individual to input an address to determine property eligibility.”
The information can be obtained at eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=sfpd.
All loans are at a fixed 1 percent interest rate for up to 20 years. This low interest rate enables the borrower to have a reasonable monthly payment that is affordable even with very low incomes.
The USDA provided the following example: a $5,000 loan at 1 percent interest for 20 years would have a monthly payment of $23 per month.
There is no penalty for early payment if the borrower wishes to pay extra or pay off early.
“There is no set average loan amount,” Miller said. “We review each applicant/co-applicant’s scenario.
“The amount of the loan that an applicant qualifies for is based on their income versus debt load,” she explained.
The Single Family Housing 504 Repair Loan and Grant Program provides loans to very-low-income homeowners to repair, improve or modernize their homes, or to remove health and safety hazards.
Miller added that in general, on 504 repair loans work is done by contractors and not the individual homeowners.
“There is a contract signed between the homeowner and contractor,” Miller said. “The contractor does not receive payment until the work is complete.”
If payments are missed by the borrower, loan servicing letters are issued for payment, Miller added.
More information on additional programs is available by visiting www.rd.usda.gov/mo. Interested parties may also contact the Sedalia office at 660-826-3339 ext 4.
