Rural Development loans available

Section 504 Home Improvement Program is accepting applications.

February 14, 2025

The warmer spring weather means home repairs come to mind sooner. Rural Development (RD) is accepting applications for our home repair program! Keep RD in mind when your clients ask how to fund critical or general home repairs.

Benefits of the Section 504 repair loan/grant program are:

• Income limits apply.
• The Section 504 Repair Loan interest rate is 1% and the maximum loan amount is $40,000 (maximum Section 504 indebtedness is $40,000).

           –  Funds can be used to modernize a home through the loan program.

• The Section 504 Grant is a lifetime award of no more than $10,000 with a term of 3 years and secured by a grant agreement.

          –  Grants are limited to elderly homeowners over the age of 62.

          –  Funds can be used to remove a health & safety hazard or make improvements to make the home more accessible to household members with disabilities.

• Closing agents are not required unless the total outstanding balance on Section 504 loans is greater than $25,000. A mortgage is required when the total Section 504 loan indebtedness is $7,500 or more.
• Work is completed by a licensed contractor.
• Adequate value is required.

Additional information can be found on the Minnesota Rural Development at rd.usda.gov/programs-services/single-family-housing-programs.