USDA Section 502 Direct Single Family Housing Loan (Maine)

What is USDA Section 502 Direct Single Family Housing Loan (Maine)?

USDA Section 502 Direct Single Family Housing Loan (Maine) is a first mortgage for homebuyers in Statewide, Maine, administered by USDA Rural Development, Rural Housing Service (Maine State & Area Offices).

• The USDA Section 502 Direct Single Family Housing Loan lets low- and very-low-income applicants in eligible rural Maine areas buy, build, repair, renovate, or relocate a home with typically no down payment. USDA directly funds the mortgage and applies 'payment assistance,' a subsidy that can reduce the effective rate to as low as 1%. Applications accepted year-round.
• No down payment typically required.
• Direct USDA mortgage.
• Payment-assistance subsidy can cut the effective rate to as low as 1%.
• Up to 33-year term (38 yrs for very-low-income).
• Fixed rate.
• This is a federal program, so it is available beyond a single state or city.

How much assistance does it provide?

USDA Section 502 Direct Single Family Housing Loan (Maine) provides assistance worth 100% of the purchase price, as set by the program.

• Award tiers: Payment assistance scaled to adjusted family income (deeper subsidy for very-low-income); effective rate as low as 1%.
• Buyer contribution: No down payment typically required; assets above USDA limits may require partial application to purchase.
• Amounts are the program's published maximums, not an offer — USDA Rural Development, Rural Housing Service (Maine State & Area Offices) determines any individual award.

Do you have to pay it back?

USDA Section 502 Direct Single Family Housing Loan (Maine) is a first mortgage and is repaid under the terms set by USDA Rural Development, Rural Housing Service (Maine State & Area Offices).

• Repayment is triggered by Payment-assistance subsidy subject to subsidy recapture upon title transfer or when borrower no longer occupies the dwelling.
• Forgiveness and repayment terms are set by the program and can change — confirm them on the official program page before applying.

Who qualifies?

USDA Section 502 Direct Single Family Housing Loan (Maine) is open to buyers who will live in the home as their primary residence.

What are the income limits?

USDA Section 502 Direct Single Family Housing Loan (Maine) sets its income limit as follows: Adjusted income at/below the applicable low-income limit for the area; very-low-income tier qualifies for deeper subsidy and 38-year term. Limits vary by county/household size per USDA Direct Loan income limit map.

• Area median income figures are published by HUD and updated annually, so check the current table for the county before relying on a number.

What kind of home can it be used for?

USDA Section 502 Direct Single Family Housing Loan (Maine) caps the purchase price as follows: Property market value may not exceed the USDA area loan limit for the county.

• Eligible property types include Single Family.
• New construction is eligible.
• Manufactured homes are eligible.

Where does it apply?

USDA Section 502 Direct Single Family Housing Loan (Maine) is a federal program, so it is not limited to Maine.

How do you apply?

Applications for USDA Section 502 Direct Single Family Housing Loan (Maine) go through USDA Rural Development, Rural Housing Service (Maine State & Area Offices), which publishes the current terms and the application steps on its own site.

1. 1

   Contact USDA Rural Development, Rural Housing Service (Maine State & Area Offices) to reserve funds

   Funds are reserved with the provider and are subject to availability.

2. 2

   Work with a lender who handles the program

   Hey Prescott is not a lender and does not accept applications; this page describes the program so a buyer can take it to a lender or housing counselor.