USDA Rural Development Loans (Section 502 Direct Loan Program) Alabama
The USDA Section 502 Direct Loan Program assists low- and very-low-income individuals in Alabama to purchase, build, or renovate homes in eligible rural areas. Offering 100% financing with no down payment, this program makes homeownership more accessible for those who meet specific income and location criteria.
Mortgage Calculator
Calculate your Cash to Close, real-time Interest Rate and Monthly Payment
Program Details
The USDA Section 502 Direct Loan Program provides affordable home financing options for eligible applicants in Alabama's rural communities. Administered by the U.S. Department of Agriculture (USDA), this program aims to improve the quality of life in rural areas by facilitating homeownership.
Eligibility Requirements
To qualify for the Section 502 Direct Loan Program in Alabama, applicants must:
-
Have an adjusted income at or below the low-income limit for the area.
-
Be a U.S. citizen, U.S. non-citizen national, or Qualified Alien.
-
Currently lack decent, safe, and sanitary housing.
-
Demonstrate the ability to repay the loan.
-
Have a satisfactory credit history.
-
Agree to occupy the property as their primary residence.
-
Be unable to obtain a loan from other sources on reasonable terms.
Program Benefits
-
Affordable Homeownership: Makes purchasing a home more accessible for low-income individuals.
-
No Private Mortgage Insurance (PMI): Reduces monthly payment obligations.
-
Closing Cost Assistance: Closing costs may be included in the loan amount.
-
Energy-Efficient Improvements: Funds can be used for energy-saving home upgrades.
How to Apply
-
Determine Eligibility
Use the USDA Eligibility Tool to check income and property eligibility.
-
Prepare Documentation
Gather proof of income, tax returns, identification, and other required documents.
-
Contact Local USDA Office
Reach out to your local USDA Rural Development office in Alabama for guidance.
-
Complete Application
Fill out the official USDA application forms.
-
Loan Processing
The USDA will review your application and verify eligibility.
-
Loan Approval and Closing
Upon approval, proceed with closing and home purchase.
💡 Tips
-
Check Income Limits Annually: They may change based on the area's median income.
-
Talk to a Housing Counselor: HUD-approved counselors can help guide you through the process.
-
Explore Additional USDA Assistance: Look into programs like Section 504 for home repairs.
-
Maintain Good Credit: A stronger credit history increases your approval chances.
Program Overview
Category
USDA Loans
Maximum Assistance
$250,000
Official Program Website
Information about this program is provided as a resource and may be subject to change. Always verify details with the official program website.
Related Resources
*Details are in the Mortgage Calculator*
Your complete toolkit for buying your first home
Get personalized rates and find programs you qualify for. Calculate payments with ease and make your dream of homeownership a reality.
Download our app to access all features
Licensed Mortgage Loan Officers
These mortgage professionals are licensed to operate in alabama and can help you navigate the application process for this program. They can answer your questions about eligibility, required documentation, and help you find the best financing options.
Licensed Mortgage Loan Officers in alabama
Connect with experienced mortgage professionals who can guide you through the home buying process and help you find the right loan program.
No Mortgage Loan Officers Available
We couldn't find any mortgage loan officers available for alabama at this time. Please check back later or contact our support team for assistance.
Contact SupportWhy work with a licensed mortgage loan officer?
Licensed mortgage loan officers have extensive knowledge of available programs, especially those for first-time homebuyers. They can help you navigate complex eligibility requirements and find the best financing options for your specific situation.
Disclaimer
Program availability, terms, and requirements may vary by lender and location. Additionally, programs are subject to change based on policy updates and market conditions. Always consult with a mortgage professional for the most current information and to determine eligibility for specific programs. The information provided on this website is for general informational purposes only and does not constitute financial, legal, or professional advice.