Single Family Housing Direct Home Loans


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Fact Sheet


Applications accepted on an ongoing basis


USDA Rural Development (USDA RD)


Provides direct loans to individuals and families with low- and very-low-income to obtain a safe, clean, affordable homes in rural areas. Offers a payment assistance subsidy that lowers mortgage payments for a short time, giving applicants a path to homeownership who otherwise would not have the opportunity to acquire a home. Loan funds may be used to:

  • Purchase or build a home
  • Renovate, repair, or relocate a home
  • Purchase a site for a home
  • Prepare a site, including water and sewage facilities

Amount of Funding

Loan amounts are based on an applicant's repayment ability and the area loan limit for the county in which the property is located. Down payments are not required unless an applicant has assets that exceed the limits set for the program.

Interest rates are fixed for the life of the loan and are based on current market rates at the time of loan approval or loan closing, whichever is lower. Rates can be as low as 1% when modified by payment assistance.

The payback period may be up to 33 years for applicants with low-income and up to 38 years for applicants with very-low-income.

Who Can Apply

Individuals or households may apply if they have an adjusted income that is at or below the applicable low-income limit for the area where they wish to buy a house. Applicant must demonstrate a willingness and ability to repay debt. Applicants must also:

  • Be without decent, safe and sanitary housing
  • Be unable to obtain a loan from other resources on terms and conditions that can reasonably be expected to meet
  • Agree to occupy the property as your primary residence
  • Have the legal capacity to incur a loan obligation
  • Meet citizenship or eligible noncitizen requirements
  • Not be suspended or debarred from participation in federal programs
  • In order to be financed with direct loan funds, properties must meet the following criteria:

    • Not have market value in excess of the applicable area loan limit
    • Not be designed for income producing activities

Under this funding opportunity, an eligible rural area is generally defined as an area with a population less than 35,000. Use the USDA Rural Business Services Property Eligibility search tool to determine if an address is located in an eligible area.

Geographic Coverage


What This Program Funds

Buildings and Facilities • Capacity Building

Application Process

Application instructions, requirements, and other information can be found on the program website.

Eligible applicants must apply through their local USDA Rural Development state office.

Application orientation guide
Program overview presentation


For program questions:
Contact the appropriate USDA Rural Development state office

Topics This Program Addresses

Housing and Homelessness