Your SlideShare is downloading. ×
0
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
USDA Section 504 Home Repair Program Overview
Upcoming SlideShare
Loading in...5
×

Thanks for flagging this SlideShare!

Oops! An error has occurred.

×
Saving this for later? Get the SlideShare app to save on your phone or tablet. Read anywhere, anytime – even offline.
Text the download link to your phone
Standard text messaging rates apply

USDA Section 504 Home Repair Program Overview

822

Published on

An overview of the USDA's Section 504 home repair program. Presentation from the Housing Assistance Councils symposium "Housing Seniors & Veterans in Rural America: Preservation, Development and …

An overview of the USDA's Section 504 home repair program. Presentation from the Housing Assistance Councils symposium "Housing Seniors & Veterans in Rural America: Preservation, Development and Services" in Council Bluffs, IA on August 28-29, 2013

0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total Views
822
On Slideshare
0
From Embeds
0
Number of Embeds
0
Actions
Shares
0
Downloads
7
Comments
0
Likes
1
Embeds 0
No embeds

Report content
Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
No notes for slide
  • Hazards and Major Hazards A hazard is a property condition that jeopardizes the health or safety of the occupants or members of the community, but that does not make it unfit for habitation. A major hazard is a condition so severe that it makes the property unfit for habitation.
  • Low-income applicants cannot receive assistance under Section 504. Only Very Low-Income applicants (Below 50% of AMI) are eligible. The applicant must own and occupy the property to be eligible for Section 504 funds, and must be able to document ownership.
  • Eligibility for a grant is contingent on whether USDA determines the applicant can afford to repay a loan . Most elderly applicants want to apply for a grant, not a loan. But before one can be determined grant eligible, loan repayment ability must be evaluated. (This is the reason 504 applicants must use the same loan application form as a home buyer. This is not well understood, though, even by USDA staff in some areas.
  • If the loan amount is less than the maximum that the applicant could repay , the loan term should be shortened so that the applicant will pay the maximum amount he or she can afford each month during the term of the loan. For example, if an applicant’s repayment ability calculations indicate the ability to repay a loan in 10 years, the loan should be written for a 10- year term rather than for the maximum term.
  • Loan Payment amount at 1% for 20 years = $ 4.60 per month per $1,000 of loan. Example $5,000 Loan ($ 4.60 x 5 = $23.00 per month)
  • Construction Standards [7 CFR 3550.106(c)] Dwellings repaired with Section 504 loan or grant funds must remain modest and all work must be completed in accordance with local codes and standards. They need not be brought to Agency development standards, nor must all of the existing hazards be removed, provided the property does not continue to have major health or safety hazards after the planned repairs are made.
  • Grant Repayment Agreements [7 CFR 3550.114] Before any grant funds are disbursed, the recipient must sign Form 3550-24, Grant Agreement . The agreement states that if a home repaired with a Section 504 grant is sold within 3 years of grant approval, the full amount of the grant must be repaid.
  • If loan funds are not committed (obligated) to a complete application usually by mid-July, then they may be pooled from all programs into a “first-come first-serve” pool.
  • If loan funds are not committed (obligated) to a complete application usually by mid-July, then they may be pooled from all programs into a “first-come first-serve” pool.
  • Info from HAC Website - We know there is far more need than funds available for this program. It would send the wrong message to have these sorely needed funds go unused. Please contact your local RD office and work with them to help eligible very low-income homeowners get their homes repaired! See July Obligations Handouts.
  • Transcript

    • 1. U. S. Department of Agriculture Rural Development Section 504 Rural Housing Repair And Rehabilitation Loans and Grants -An Overview-
    • 2. Section 504 Rural Housing Repair and Rehabilitation Loans and Grants
    • 3. Regulation/Handbook: 7 CFR Part 3550 and HB-1-3550, Chapter 12 Section 504 Loans and Grants Section 504 Home Repair Loans and Grants
    • 4. Regulations Regulations for USDA/RD Section 504 Rural Housing Repair and Rehabilitation Loans and Grants, are compiled in 7 CFR Part 3550; Two handbooks provide details and instructions about the various aspects of the 504 program.  HB-1-3550 covers tasks undertaken by RD field offices;  HB-2-3550 explains the work of the agency’s centralized servicing center.
    • 5. Section 504 Direct Loan /Grant Programs USDA Rural Development provides direct loans and grants, as-well-as guaranteed loans, in rural areas. Rural areas include open country and places with a population of 10,000 or less and, under certain conditions, towns and cities between 10,000 and 25,000 population; Low-income is defined as between 50 and 80 percent of area median income (AMI); Very low- income is below 50 percent AMI.
    • 6. Rural Development Service Area and Eligibility Information RD Rural Housing Programs are rural programs. Service area, income and property eligibility can be determined by contacting the local RD Service Center or online at - http://eligibility.sc.egov.usda.gov/eligibility/ Web link can be used to learn more about a USDA home loan programs; Determine if a property is located in an eligible rural area; Determine income eligibility of an applicant/ household; or to find out how to apply for a Rural Development Loan.
    • 7. Purpose: Section 504 Housing Repair programs provide loans and grants to very low-income homeowners to repair, improve, or modernize their dwellings or to remove health and safety hazards; or remodel dwellings to make them accessible to household members with disabilities. Section 504 Home Repair Loans and Grants
    • 8. Purpose: Section 504 Loan Funds may be used to improve or modernize, make a dwelling decent, safe, and sanitary; and/or remove health and safety hazards. Section 504 grant funds may be used only for repairs and improvements that will remove health and safety hazards, or to repair or remodel dwellings to make them accessible and useable for household members with disabilities. Section 504 Home Repair Loans and Grants
    • 9. Purpose: Section 504 loan and grant funds can also be used to repair mobile or manufactured homes if:  The applicant owns the home and the site and occupied the home prior to filing an application;  The repairs are needed to remove health or safety hazards; and  The home is on a permanent foundation, or will be put on a permanent foundation with Section 504 funds. Section 504 Home Repair Loans and Grants
    • 10. Restrictions on the Use of 504 Funds Section 504 loan or grant funds cannot be used to: Acquisition or new construction Pay for off-site improvements Refinance debt Purchase/install appliances Site preparation or landscaping (Examples - Include, but not limited to) Section 504 Home Repair Loans and Grants
    • 11. Section 504 Home Repair Loans and Grants Eligibility: Homeowner-occupants must be unable to obtain affordable credit elsewhere and must have very low incomes, (below 50 percent of the area median income). Repairs and improvements must make the dwelling more safe and sanitary or remove health and safety hazards.
    • 12. Section 504 Home Repair Loans and Grants Eligibility: Direct Loans and Grants Income Limits located at: http://www.rurdev.usda.gov/HSF- Direct_Income_Limits.html
    • 13. Eligibility: Grants are only available to homeowners who are 62 years old or older and cannot repay a Section 504 loan. At least one applicant must be 62 or older. If a budget analysis, based on Form RD 1944-3, indicates that a grant applicant has partial repayment ability, as much of the amount as possible must be issued as a loan, with ONLY the remainder issued as a grant. Section 504 Home Repair Grants
    • 14. Terms: Loans of up to $20,000 and grants of up to $7,500 are available. Loans are for up to 20 years at 1 percent interest. (If the loan amount is less than the maximum that the applicant could repay, the loan term should be shortened) Section 504 Home Repair Loans and Grants
    • 15. Terms: Repairs financed with grant funds must result in the removal of health and safety hazards. Loans and grants can be combined for up to $27,500 in Section 504 assistance. Section 504 Home Repair Loans and Grants
    • 16. Terms: A grant/loan combination is made if the applicant can repay part of the cost. Loans made in combination with grants must be amortized over the full 20 years to maximize the loan amount while minimizing the grant amount. Section 504 Home Repair Loans and Grants
    • 17. Maximum Loan and Grant Amounts: The sum of the outstanding balance on all Section 504 loans can never be more than $20,000. The lifetime grant assistance to any applicant cannot exceed a cumulative total of $7,500. Maximum Based on Eligible Costs: The applicant can only receive loan/grant funds to cover eligible costs. (For example, if the applicant has only $5,000 of eligible repairs to make, the maximum loan/grant allowed is $5,000.) [7 CFR 3550.112] Section 504 Home Repair Loans and Grants
    • 18. Property Requirements: Must be considered modest for the area Must not have an in-ground pool Must not have a value in excess of the area loan limit. Section 504 Home Repair Loans and Grants
    • 19. Standards: Repaired properties must remain modest and all work must be completed in accordance with local codes and standards. [7 CFR 3550.106(c)] Water supply and sewage disposal systems should meet RHS requirements. Section 504 Home Repair Loans and Grants
    • 20. Standards: Major health and safety hazards must be corrected.  Not all existing hazards need to be removed, provided the property does not continue to have major health or safety hazards after the planned repairs are made. Section 504 Home Repair Loans and Grants
    • 21. Security: Section 504 Loans greater or equal to $7,500, a mortgage is required.  Section 504 Grants, no security required. (Grant recipient must sign Form 3550-24 Grant Agreement stating grant funds are subject to recapture, and must be repaid in full, if property is sold within 3 years) [7 CFR 3550.114] Section 504 Home Repair Loans and Grants
    • 22. Approval: Rural Development should make a decision on an application within 30 to 60 days of receiving it. Approvals are always contingent upon availability of funding. Section 504 Home Repair Loans and Grants
    • 23. Program Funding USDA Rural Development. Program (millions of dollars) FY11 Final Approp. FY12 Final Approp. FY13 Final Approp. FY14 Admin. Budget FY14 House Bill 504 VLI Repair Loans $23.4 $10 $ 28 $26.3 $25.4 504 VLI Repair Grants $34 $29.5 $29.5 $25 $18.6
    • 24. POOLING Non-obligated funds are pooled for redistribution by National Office. Pooling usually occurs in mid-July/August. Applications may be selected for processing based on date completed and on processing priority, in the event there is a waiting list at the local office.
    • 25. FINDING A LOCAL RD OFFICE For Additional Information: USDA Rural Development Website http://www.rurdev.usda.gov USDA’s Office Locator Web Site: http://offices.sc.egov.usda.gov/ Check in the white pages in your local phone book under USDA/Rural Development Call Rural Development’s Public Information line to be connected to the State Office servicing your area. 1-800-670-6553
    • 26. Click on “By City”
    • 27. Enter the city name and select the State where the home to be repaired is located.
    • 28. Locate the “Rural Development” office
    • 29. Application Forms USDA E-Forms Website http://forms.sc.egov.usda.gov Form RD 410-4, “Uniform Residential Loan Application” http://forms.sc.egov.usda.gov/efcommon/ eFileServices/eForms/RD410-4.PDF Form RD 3550-1, “Authorization to Release Information” http://forms.sc.egov.usda.gov/efcommon/ eFileServices/eForms/RD3550-1.PDF
    • 30. Help USDA Use Section 504 funds As of July 31, 2013, USDA RD reported:  30.8% of Section 504 loan funds had been obligated and $18.7 million were still available for Section 504 loans. Loan funds not obligated by September 30 will be lost. 71.1% of Section 504 grant funds had been obligated and $7.7 million were still available for Section 504 grants. Unobligated funds are expected to be Pooled August 16, 2013. All states will have access to loan funds after RD pools and redistributes the amounts not yet used in some states. Your help in getting out the word and working with RD to process loan applications is critical.
    • 31. Additional Information For additional information on the Section 504 Home Repair Loan and Grant Programs, and Rural Development, contact the National Office, 1400 Independence Avenue, S.W., Washington, DC 20250; 202-690-1533.
    • 32. Strategic Contacts and Partnerships Keep HAC in mind for potential training, information, loan assistance, and as a gateway to other federal programs, funding notices, or housing information and policy in general; Visit the HAC website at www.ruralhome.org
    • 33. Housing Assistance Council Housing Assistance Council 1025 Vermont Ave Ste 606 Washington DC 20005 (202) 842-8600 hac@ruralhome.org www.ruralhome.org Southeast Regional Office 600 West Peachtree Street NW Ste 1500 Atlanta, GA 30308 (404) 892-4824 southeast@ruralhome.org Midwest Regional Office 10100 N Ambassador Dr Ste 310 Kansas City, MO 64153 (816) 880-0400 midwest@ruralhome.org Southwest Regional Office 7510 Montgomery, NE Ste 205 Albuquerque, NM 87109 (505) 883-1003 southwest@ruralhome.org West Regional Office 717 K Street Ste 404 Sacramento, CA 95814 (916) 706-1836 west@ruralhome.org
    • 34. Wrap-Up Participant Questions Conclude

    ×