USDA Rural Development Financing

The goal of the U.S. Department of Agriculture (USDA) Financing programs is to improve and increase affordable housing in rural areas of the country. The programs are administered by the Office of Rural Development within the U.S. Department of Agriculture (USDA). All of the programs listed here are opened for application through the annual HUD Notice of Funding Availability (NOFA).

Section 502 Program
County offices administer Section 502 funds. This program finances the purchase, construction or rehabilitation of owner-occupied single-family homes. Eligible houses must be modest in cost, size, and design, and can include mobile homes. Eligible applicants must meet low or very-low income criteria. The 2001 budget from the USDA allocated $1.3 billion to this program. Click here for more information on the Section 502 program.

Section 504 Program
The Section 504 program provides loans or grants to rural elderly or disabled very low-income homeowners. Grants must be used for emergency repairs to water and sanitary sewer systems, wiring, structural supports, and roofs. Unlike grants, loans may be used for cosmetic repairs. There was $30 million available for the low-income home repair grants in 2001, leaving $40 million for loans. Click here for more information on the Section 504 program.

Section 515 Rural Rental Housing Program
This program provides low-interest loans to purchase, construct, or rehabilitate affordable housing in rural areas. The type of housing may be multifamily or congregate, but it must be for families, older people, and people with disabilities who meet the criteria of very low, low, or moderate incomes. Loans are made for periods of time up to 30 years for as low as 1 percent. Click here for more information on the Section 515 program.

Section 521
This funding provides rental assistance to residents in Section 515 homes. Residents covered by Section 521 only pay 30 percent of their income for rent and utilities - the rest of the rent is covered by Section 521. There is a shortage of these funds, as most of them are applied to renew existing Section 521 contracts. Click here for more information on the Section 521 program.

Section 538 Rural Rental Housing Guaranteed Loan Program
The purpose of this program is to improve and increase the construction, acquisition, and rehabilitation of rural multi-family homes. The residents who benefit from this housing cannot have incomes greater than 115 percent of the area median income after factoring in the size of the family. The amount that tenants pay cannot be greater than 30 percent of this figure.
Section 538 loans can be for up to 40 years; therefore, borrowers (developers) can get a favorable interest rate. Click here for more information on the Section 538 program.

Chattanooga Area Office
25 Cherokee Blvd. Suite A 
P.O. Box 4941
Chattanooga, TN 37405
(423) 756-2239
Serves Bledsoe, Bradley, Grundy, Hamilton, Polk, Rhea, Sequatchie

Cookeville Area Office
390 South Lowe Avenue
P.O. Box 555
Cookeville, TN 38503
(931) 528-6539
Serves Cannon, Clay, Cumberland, Fentress, DeKalb, Jackson, Macon, Overton, Pickett, Putnam, Smith, Van Buren, Warren, White

Nashville Area Office
3322 West End Avenue
Suite 302
Nashville, Tennessee 37203-6835
(615) 783-1359
Serves Cheatham, Davidson, Dickson, Houston, Humphries, Montgomery, Robertson, Rutherford, Stewart, Sumner, Trousdale, Williamson, and Wilson

Jackson Area Office
West Towne Commons
85G Stonebrook Place
Jackson, Tennessee 38305
(731) 668-2091 ext. 2
Serves Chester, Decatur, Hardeman, Hardin, Haywood, Henderson, McNairy, and Madison

Covington Area Office
2043 Highway 51 South,
Covington, TN 38019
(901) 475-3350 ext. 4
Serves Fayette, Lauderdale, Shelby, Tipton

Union City Area Office
1216 Stad Avenue, Suite 3
Union City, Tennessee 38281
(731) 885-6480 ext. 4
Serves Benton, Carroll, Crockett, Dyer, Gibson, Henry, Lake, Obion, and Weakley

Greeneville Area Office
214 N. College St., Suite 300, PO Box 307
Greeneville, TN 37744-0307
(423) 638-4771 ext. 4
Serves Carter, Greene, Hancock, Hawkins, Johnson, Sullivan, Unicoi, and Washington

Knoxville Area Office
4730 New Harvest Lane, Suite 300, Knoxville, TN 37918-7000
(865) 523-3338 ext. 4
Serves Anderson, Blount, Campbell, Claiborne, Cocke, Grainger, Hamblen, Jefferson, Knox, Loudon, Monroe, Morgan, Roane, Scott, Sevier, and Union

Lawrenceburg Area Office
237 Waterloo Street, P.O Box 1046, Lawrenceburg, Tennessee 38464
(931) 762-6913 ext.4 
Serves Bedford, Coffee, Franklin, Giles, Hickman, Lawrence, Lewis, Lincoln, Marshall, Maury, Moore, Perry and Wayne