What is the Section 504 Home Repair program?

Home maintenance is expensive, but keeping a home in good condition helps sustain its value and avoid health and safety issues. The Section 504 Home Repair program through the U.S. Department of Agriculture (USDA) offers low-interest loans and grants for very-low-income homeowners living in eligible rural areas.

Loans and grants through Section 504 are available directly from the USDA. Although Rocket Mortgage^® doesn’t offer USDA loans of any kind, we do want you to be aware of this option as a potential solution for affordable home repair.

What does the Section 504 Home Repair program do?

Focused on rural areas where homes may be in need of modernization and local lending options may be limited, the Section 504 Home Repair Program is intended to help very-low-income homeowners find access to affordable credit when they may not qualify for other home improvement loans.

Seniors may also be eligible for grants to remove health and safety hazards and make their homes more accessible as they age. The resources for owners of single-family homes could help pay for much needed repairs. According to Angi, the average home renovation cost as of June 2025 was $52,253 for a 1,600 square-foot home.

What can the single-family housing repair loans and grants be used for?

Loan funds under Section 504 can be used to make repairs that improve or modernize a home, including everything from adding an addition to the home to purchasing essential replacement appliances. Grant funds can only be used for removing health and safety hazards or accessibility improvements for someone with a disability.

What’s the difference between Section 504 loans and Section 504 grants?

The most obvious difference between using Section 504 loans and grants for renovation or remodeling is that the grants don’t have to be paid back. But there are also other differences in how the two can be used.

Section 504 loans

Section 504 loans can be used to repair, improve, or remove health and safety hazards from a home. They have a maximum $40,000 loan amount and a 1% interest rate over a term of 20 years. Although the USDA doesn’t specify a minimum credit score, it may be easier to qualify if your score is above 620.

With high enough loan amounts, a lien may be required as with any mortgage. Loan amounts over $25,000 will require full title service, which entails working with the title company to get title insurance. The house title refers to the bundle of rights you get when you purchase real estate. The deed is the document transferring those rights.

Section 504 grants

Grants of up to $10,000 can be used to remove health and safety hazards, if you’re 62 or older. This includes making the home accessible for people who have a disability. For example, you might add wheelchair ramps, grab bars, roll-in showers, or walk-in bathtubs. You have to repay the grant if the home is sold in fewer than 3 years.

Qualifications for Section 504 Home Repair

Since the Section 504 Home Repair program is designed to help certain homeowners, not everyone will be approved for a loan or grant through it. Here are some of the qualifications an individual may need:

• Live in a rural area
• Be a U.S. citizen or a legal permanent U.S. resident
• Be the homeowner and occupier of the house in question
• At least 18 years old or above
• Cannot obtain or afford credit from other lenders
• Have a family income less than 50% of the area’s median income
• For grants, be at least 62 years old or above and unable to repay a loan

The promised repair assistance is determined based on the household’s financial situation and related details, such as real estate taxes, homeowner’s insurance and other monthly debts.

How to apply for Section 504 Home Repair loans and grants

If you’re looking to apply for a USDA loan, it’s a good idea to start by talking to your local Rural Development office. Each state may have slightly different requirements. There’s also a waitlist for funding in different states, so you may have to wait a while in some instances. Here’s the general application process:

1. It’s recommended to fill out the Section 504 Home Repair loan and grant intake form.
2. You can also expect to fill out an authorization to release information to the agency.
3. Those who are applying for the loan will fill out a Uniform Residential Loan Application.
4. You’ll have to fill out a form certifying your income and assets.
5. There’s a checklist of all the items you need.

The bottom line: The USDA’s Section 504 Home Repair program offers valuable support

The Section 504 Home Repair program from the USDA offers loans and grants to modernize and approve homes in eligible rural areas. The grants are for eligible seniors to remove health and safety hazards within the home. It’s one of several government loans that may be available.

It’s only one option, so if you’re looking for resources, check out our article on home improvement grants. If you’re considering utilizing your home equity through a home equity loan or cash-out refinance, you can apply online with Rocket Mortgage.