USDA loans okayed for home energy efficiency projects

TEMPLE—The USDA Rural Development announced that Section 504 loan funds are available to qualified applicants to make their homes more energy efficient.

Loan funds may also be used to make general repairs to improve or modernize the property, as long as the dwelling remains modest.

“The Section 504 Loan Program not only helps homeowners repair their homes and make their homes more energy efficient, but is an important component of USDA’s economic development efforts,” said Paco Valentin, state director for the USDA’s Rural Development department.

Having an energy efficient home can be accomplished very easily.

Examples of making a home more energy efficient include installing double pane windows, more insulation in the attic, weather stripping the doors, caulking existing windows, and the installation or upgrade of a heating or cooling unit with higher seasonal energy efficiency rating for the purpose of removing health hazards. Doing such would reduce the costs of heating and cooling a home.

Section 504 loans have an interest rate of 1 percent and a maximum term of 20 years.

Maximum loan amount is $20,000. To qualify for a Section 504 loan, the applicant must have a reliable income source sufficient to allow repayment of the loan.

Applicants must also have a credit history that indicates a reasonable ability and willingness to meet debt obligations.

The adjusted household income at t he t ime of loan approval and at loan closing must not exceed the USDA Rural Development applicable very low income limit.

In order to be eligible for a Section 504 loan, the applicant must own and occupy the property. The property must be considered modest for the area, must not have an in-ground pool, and must not have a value in excess of the area loan limit.

For the pur pose of USDA Rural Development housing assistance the property must be located in an eligible rural area. To determine if your property is located in an eligible rural area, please contact the USDA Rural Development area office that serves your area, which can be located at or call (254) 742-9770 for assistance.

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