USDA / RD Mutual Self-Help Housing Loan & Technical Assistance Program

OVERVIEW: The U.S. Department of Agriculture – Rural Development provides technical assistance grants and site loans (Section 523 and 524) to nonprofit and local government organizations. These entities supervise groups of 5 to 12 families in the construction of their own homes. Site Loans may be used to buy and develop building sites, including the construction of access roads, streets, and utilities. Technical Assistance Grant money may be used for salaries, rent, and office expenses of the nonprofit organization providing assistance. Families participating in a mutual self-help project perform approximately 65% of the construction labor on each others homes under qualified supervision. Loans are for up to 33 years (38 for those with incomes below 60% of the area median and who cannot afford 33-year terms). The interest rate is set by USDA; however using payment assistance can reduce the interest rate to as low as 1%. There is no required down payment. Housing must be modest in size, design, and cost, which is defined as housing costing less than the HUD dollar cap. Houses constructed must meet the voluntary national model building code adopted by the state and USDA thermal and site standards.

TIMETABLE: Communities or non-profits interested in developing housing for low income individuals may submit applications to USDA Rural Development field offices when they are prepared.

HOW: Contact USDA Rural Development field offices for information. Individuals interested in building their homes should locate a participating community or non profit.

WHERE: For more information, please visit the program’s homepage.

TAGS: funding, home, low income