Having access to housing becomes more important as the years go by, and as you grow older, you’ll want to settle down and have a place of your own where you can feel safe and comfortable.
However, not everyone’s home is in good enough shape to provide this sense of security for longer periods of time, and most lower-income families will struggle with obtaining the funds necessary to perform all the repairs.
Thankfully, the federal government looks out for the little man, and with their assistance programs, they’ve managed to provide affordable housing options for hundreds of thousands of needy Americans.
Their Single Family Housing Repair Loans and Grants program is targeted at low-income households in need of repairs or improvements to their home that can’t be covered by their current income levels.
With the help of the program, these families can receive loans and even grants to help them pay for the repair expenses, and in the case of it being a grant, they don’t ever have to pay it back.
How does this program work?
Often referred to as the Section 504 Home Repair Program, this loan and grant option has been made possible with the help of the US Department of Agriculture and their Rural Housing Service subsection.
The program itself has two purposes, one being to provide loans for families in need of repairs to their homes, whereas the program’s 2nd function is to provide grants to homeowners aged 62 and up that are below the federal poverty line.
These grants can then be used to cover the expenses of services and work that would remove safety and health hazards from the home, as well as certain modifications that would make it more accessible to members of the household that have disabilities.
Essentially, Section 504 exists to make living more comfortable for lower-income Americans, and even though these loans do have to be paid back, the family can focus on their financial stability instead of worrying about the cost of repairs.
In contrast to most other housing assistance programs, Section 504 is intended for existing homeowners whose families are the only residents of a home.
To qualify for the program, you must meet a set of requirements which include but aren’t limited to being a US citizen, owning the said home, and meeting your area’s guidelines for what’s labeled as “low-income”.
In most places, this means that your total household income is below 50% of the area’s average total household income.
On top of this, you must also not have the ability to take out an affordable loan through any other means, and if you’re 62 years or older, you may even qualify for a grant, provided you don’t have the ability to repay a loan.
Apart from the requirements that apply directly to you, there are also some that apply to the property, as only homes from eligible rural areas can qualify for Section 504 assistance, and as vague as this may sound, you can find a map on the USDA’s official website to explore this a bit further.
The amount of money you can obtain from Section 504 assistance depends entirely on whether your current circumstances qualify you for a loan or a grant, as there’s a noticeable difference between the two.
For example, with a loan, the USDA can offer you up to $40k, which you’ll be obligated to pay back within 20 years at a fixed interest rate of only 1%.
However, for loans that go above the $25k mark, a full title service is absolutely necessary, although the upside is that no down payment is required, regardless of how much money you’re borrowing.
As for grants, the maximum amount you can receive goes up to $10k, and unless you sell the property within 3 years of accepting the grant, you’re not required to pay any of the money back to the lender.
However, if you can repay a portion of the funds you’re looking to get, but not all of them, you may be able to qualify for a combination of the aforementioned two, with the maximum limit for combining being $50k.
How to use this money
The money obtained through these loans and grants can be used for a number of different purposes, such as fixing leaky roofs or repairing a faulty heating/cooling system in the home.
At times, the money can also cover the expenses of cosmetic and structural works on the property, like additions to the current kitchen arrangement or any upgrades one can make to the bathroom.
However, it’s important to note that the primary use of the USDA grants is to eliminate any health risks for older residents that the home is exhibiting in its current state, and they should be used accordingly.