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Rural Housing Site Loans And Self-Help Housing Land Development Loans

Program Descriptions

Program Number



Rural Housing Site Loans And Self-Help Housing Land Development Loans


Federal Agency




Housing Act of 1949, as amended, Sections 523 and 524, Public Law 89-117; Public Law 89-754, 42 U.S.C. 1490c and d.






To assist public or private nonprofit organizations interested in providing sites for housing; to acquire and develop land in rural areas to be subdivided as adequate building sites and sold on a cost development basis to families eligible for low and very low income loans, cooperatives, and broadly based nonprofit rural rental housing applicants.


Types of Assistance

Direct Loans.


Uses and Use Restrictions

For the purchase and development of adequate sites, including necessary equipment which becomes a permanent part of the development; for water and sewer facilities if not available; payment of necessary engineering, legal fees, and closing costs; for needed landscaping and other necessary facilities related to buildings such as walks, parking areas, and driveways. Restrictions: loan funds may not be used for refinancing of debts, payment of any fee, or commission to any broker, negotiator, or other person for the referral of a prospective applicant or solicitation of a loan; no loan funds will be used to pay operating costs or expenses of adminsitration other than actual cash cost of incidental administrative expenses if funds to pay those expenses are not otherwise available. Repayment of loan is expected within two years.


Eligibility Requirements

Applicant Eligibility

A private or public nonprofit organization that will provide the developed sites to qualified borrowers on a cost of development basis in open country and towns of 10,000 population or less and places up to 25,000 population under certain conditions. Applicants from towns of 10,000 to 25,000 population should check with local RD office to determine if agency can serve them. Assistance is available to eligible applicants in States, Puerto Rico, the Virgin Islands, Guam, and the Northern Marianas.

Beneficiary Eligibility

Sites developed with Section 524 loans must be for housing low and very low income families and may be sold to families, nonprofit organizations, public agencies and cooperatives eligible for assistance under any Section of Title V of the Housing Act of 1949, or under any other law which provides financial assistance. Sites developed with Section 523 loans must be for housing to be built by the self-help method.


Applicants must furnish evidence of the following: (1) Market analysis showing need for such services; (2) legal capacity to borrow funds and develop land for sale; (3) a sound budget; and (4) general project description. This program is excluded from coverage under OMB Circular No. A-87.


Application and Award Process

Preapplication Coordination

Environmental impact assessment and environmental impact statements are required for this program. This program is eligible for coverage under E.O. 12372, "Intergovernmental Review of Federal Programs." An applicant should consult the office or official designated as the single point of contact in his or her State for more information on the process the State requires to be followed in applying for assistance, if the State has selected the program for review. This program is excluded from coverage under OMB Circular No. A-102.

Application Procedure

The application will be in the form of a letter to the Rural Development Manager of the Rural Development (RD). Supporting information and costs should be included as needed. This program is excluded from coverage under Departmental Regulations 3015 and 3016, and OMB Circular No. A-110.

Award Procedure

After application has been reviewed.



Range of Approval/Disapproval Time

From 60 to 90 days.


A uniform procedure whereby an organization which is directly or adversely affected by an administrative decision by Rural Development Rural Housing Programs is found in 7 CFR 3550.4. Applicants may request reconsideration on the basis of pertinent facts concerning his application.



Assistance Considerations

Formula and Matching Requirements

Not applicable.

Length and Time Phasing of Assistance

Not applicable.


Post Assistance Requirements


RD District office monitors the loan and reports to the State Director should the borrower default in its loan obligations.


Not applicable.


Adquate operating records must be maintained by borrower.


Financial Information

Account Identification

12-4141-0-3-371; 12-2081-0-1-371.


(524 Site Loans) FY 07 $2,450,000; FY 08 est not available; and FY 09 est not available. (523 Site Loans) FY 07 $570,000; FY 08 est not available; and FY 09 est not available.

Range and Average of Financial Assistance

Not available.


Program Accomplishments

In fiscal year 2007, four loans were made in the 523 program, and one loan was made in the 524 program.


Regulations, Guidelines and Literature

RD Instruction 444.8, "Rural Housing Site Loan Policies, Procedures, and Authorizations"; 7 CFR 1822.261-1822.278; PA-1131.


Information Contacts

Regional or Local Office

Consult your local telephone directory for RD District Office number. If no listing, get in touch with appropriate RD State office listed in Appendix IV of the Catalog or on the internet at

Headquarters Office

Director, Single-Family Housing Processing Division, Rural Housing Service, Department of Agriculture, Washington, DC 20250. Telephone: (202) 720-1474. Use the same number for FTS.

Web Site Address


Related Programs

10.410, Very Low To Moderate Income Housing Loans
10.415, Rural Rental Housing Loans
10.420, Rural Self-Help Housing Technical Assistance


Examples of Funded Projects

Caver County Housing and Redevelopment Agency, Chanhassen, Minnesota.


Criteria for Selecting Proposals

Not applicable.


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