Direct Housing-Natural Disaster
RURAL DEVELOPMENT, RURAL HOUSING PROGRAMS (RHP), DEPARTMENT OF AGRICULTURE
Housing Act of 1949, Title V, Section 502, as amended, Public Law 89-117, 42 U.S.C. 1471 et seq; Public Law 92- 310, 42 U.S.C. 1480, 42 U.S.C. 1472; Public Law 98-51; Public Law 100- 233; Amendment of Consolidated Farm and Rural Development Act of 1987, Section 601.
To assist qualified lower income rural families to meet emergency assistance needs resulting from natural disaster to buy, build, rehabilitate, or improve dwellings in rural areas. Funds are only available to the extent that funds are not provided by the Federal Emergency Management Agency (FEMA). For the purpose of administering these funds, natural disaster will only include those areas identified by a Presidential declaration.
Types of Assistance
Uses and Use Restrictions
Direct loans may be used for construction, repair, or purchase of housing. Payment subsidy is available to eligible low and very low-income applicants. The term payment subsidy refers to either payment assistance or interest credit. A payment subsidy reduces the borrower's scheduled payment to an amount equal to what it would be if the note were amortized to as low as one percent. Payment subsidies are subject to recapture by the government when the borrower transfers title or ceases to occupy the property.
Applicants must be without adequate resources to obtain housing or related facilities. Applicants must be unable to secure the necessary credit from other sources at prevailing terms and conditions for residential financing.
Applicants/borrowers are the direct beneficiaries when they meet all eligibility criteria.
Natural disasters will only include those areas identified by a Presidential declaration. Funds are only available to the extent that funds are not provided by the Federal Emergency Management Agency (FEMA). Applicants must establish that physical damage was caused by natural disaster. An applicant needs to submit evidence of inability to obtain credit elsewhere, verification of income and debts, plans, specifications, and cost estimates. This program is excluded from coverage under OMB Circular No. A-110.
Application and Award Process
This program is excluded from coverage under OMB Circular No. A-102 and E.O. 12372.
Applicants must file Form RD 410-4 at the Rural Development field office serving the county where the dwelling is located. This program is excluded from coverage under OMB Circular No. A-110.
Final approval of the application is approved by the Community Development Manager.
Applicants must file applications from the date of declaration/designation and until supplemental appropriated funds are exhausted.
Range of Approval/Disapproval Time
From 30 to 60 days subject to the availability of funds, from the time the application is filed if no backlog of applications exists.
Applicants may request reconsideration at the local Rural Development field office or may appeal adverse actions in accordance with RD Instruction appeal procedure. Appeals may be filed within 30 days after notification of the adverse decision is received by the loan applicant.
Formula and Matching Requirements
This program has no matching requirement or statutory formula.
Length and Time Phasing of Assistance
These funds are available only until the Supplemental Emergency Funding for Natural Disaster are exhausted.
Post Assistance Requirements
Borrowers are not required to, but should retain copies of loan related documents.
(Loans) FY 07 $0; FY 08 est. not available; and FY 09 est. not available (Note: Funds under this program are based on supplemental funding provided by Congress in response to a natural disaster. Hurricane Emergency Supplemental funds are not included in the projected amounts.)
Range and Average of Financial Assistance
In fiscal year 2007, no houses were financed through the Section 502 Direct Loan (Natural Disaster) Program.
Regulations, Guidelines and Literature
7 CFR Part 3550.
Regional or Local Office
Consult your local telephone directory under United States Department of Agriculture for Rural Development field office number. If no listing, contact appropriate Rural Development State Office listed in Appendix IV of the Catalog or on the internet at http://www.rurdev.usda.gov/recd_map.html
Director, Single Family Processing Division, Rural Housing Programs (RHP), Department of Agriculture, Washington, DC 20250. Telephone: (202) 720- 1474. Use the same number for FTS.
Web Site Address
10.405, Farm Labor Housing Loans And Grants
10.411, Rural Housing Site Loans And Self-Help Housing Land Development Loans
10.417, Very Low-INCOME Housing Repair Loans And Grants
10.420, Rural Self-Help Housing Technical Assistance
Examples of Funded Projects
Criteria for Selecting Proposals