USDA offers loans and grants for home repairs in rural areas of Maryland through a program known as Section 504 Home Repair program. The program provides loans to very-low-income homeowners to repair, improve or modernize their homes. And, for elderly very-low-incom homeowners, they provide grant to remove health and safety hazards.
To qualify for this program, you must be the homeowner and occupy the house; be unable to obtain affordable credit elsewhere; have a family income below 50 percent of the area median income; and for grants, be age 62 or older and not be able to repay a repair loan.
The maximum loan amount is $20,000 and the maximum grant amount is $7,500. However, loans and grants can be combined for up to $27,500 in assistance. The funds may be used to repair, improve or modernize homes or remove health and safety hazards for repair loans. Grants must be used to remove health and safety hazards.
The USDA loan terms are:
- Can be repaid over 20 years
- Loan interest rate is fixed at 1%
- Full title service is required for loans of $7,500 or more
The grant terms are:
- Grants have a lifetime limit of $7,500
- Must be repaid if the property is sold in less than 3 years
- If applicants can repay part, but not all of the costs, applicants may be offered a loan and grant combination.
Applications are taken year-round and approval times depend on funding availability in each area. If interested, you can talk to a USDA home loan specialist in Worcester County to help complete an application.
Lauren Bunting is a Broker with Keller Williams Realty of Delmarva in Ocean City, Maryland.
