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With Section 504 home repair loans and grants, the USDA Rural Development provides financing to qualified very low income homeowners to repair or make improvements to their home.

Examples of items which may be financed include:
• Remove/repair health and safety hazards (electrical, sewage disposal, water, roof, structural items).
• Home weatherization (insulation, window repair/replacement, heating systems).
• Utility hookup, installation and/or assessment fees.
• Accessibility accommodations for persons with disabilities.
• Repairs to a manufactured home, provided that the applicant owns the land and the structure is on a permanent foundation (or will be placed on a permanent foundation with the 504 repair funds).

Applicants must be the owner and occupant of a dwelling located in a rural area, which meets the Rural Development definition of modest (having a market value less than the applicable area loan limit). In most cases, an area is considered rural if the population is 10,000 or less. The following website can be used to help determine if the property is eligible: www.eligibility.sc.egov.usda.gov/eligibility/.

For the home loans, all applications are reviewed for loan eligibility first. In order to qualify for the one percent interest rate loan program, applicants must meet minimum eligibility requirements which include, but are not limited to:
• Adjusted household income which is calculated by starting with the gross income of the household and subtracting items such as $480 per child credit, monthly daycare expenses, and medical expenses for qualifying households.
• A satisfactory credit history of 660 or above. However, applicants with lower scores may be eligible under certain circumstances.
• A stable source of income, which provides adequate ability to repay the USDA loan payments as well as the applicant’s consumer debt obligations.
• Be a U.S. Citizen or legally admitted U.S. resident who is 18 years of age or older and is able to enter into a binding contract.
• Must be unable to pay for the repairs from assets or other conventional financing.
Loan funds may be used to remodel or upgrade a dwelling, provided that any health and safety hazards are repaired first.

For the Section 504 grants, applicants age 62 or older, who meet the criteria above but do not show repayment ability for the entire loan, may be considered for a loan/grant combination or in some cases a grant (up to a lifetime limit of $7,500). However, 504 Grant funds may only be used to repair and/or remove health and safety hazards, or to provide accessibility accommodations for household members with disabilities.