USDA Section 502 Guaranteed Loan Program (Rhode Island)

What is USDA Section 502 Guaranteed Loan Program (Rhode Island)?

USDA Section 502 Guaranteed Loan Program (Rhode Island) is a first mortgage for homebuyers in Rhode Island, administered by USDA Rural Development, Rural Housing Service (Single Family Housing Guaranteed Loan Program), through approved lenders.

• The USDA Section 502 Guaranteed Loan Program helps approved private lenders provide low- and moderate-income Rhode Island households 100% financing to buy, build, rehabilitate, improve, or relocate a modest home in an eligible rural area as a primary residence. USDA guarantees 90% of the loan note to reduce lender risk, enabling no-money-down 30-year fixed-rate mortgages. Household income may not exceed 115% of area median income, and there is no program credit-score minimum.
• 100% financing - no down payment required.
• 30-year fixed rate.
• No program minimum credit score.
• Closing costs may be financed where value supports.
• Wide property eligibility including condos, modular, and manufactured homes.
• Single-close construction-to-permanent option available.
• This is a federal program, so it is available beyond a single state or city.
• Funding comes from USDA provides a 90% loan note guarantee to approved private lenders making 100% financing loans.

How much assistance does it provide?

USDA Section 502 Guaranteed Loan Program (Rhode Island) provides assistance worth 100% of the purchase price, as set by the program.

• Buyer contribution: No down payment required (100% financing).
• Amounts are the program's published maximums, not an offer — USDA Rural Development, Rural Housing Service (Single Family Housing Guaranteed Loan Program), through approved lenders determines any individual award.

Do you have to pay it back?

USDA Section 502 Guaranteed Loan Program (Rhode Island) is a first mortgage and is repaid under the terms set by USDA Rural Development, Rural Housing Service (Single Family Housing Guaranteed Loan Program), through approved lenders.

• The assistance is recorded in first position.
• 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 Guaranteed Loan Program (Rhode Island) is open to buyers who will live in the home as their primary residence.

What are the income limits?

USDA Section 502 Guaranteed Loan Program (Rhode Island) limits household income to 115% of the area median income, which varies by county and household size.

• Household income may not exceed 115% of area median income. The 2026 national baseline moderate-income limit is $119,850 for households of 1-4 persons and $158,250 for 5-8 persons; RI county-specific limits may be higher and should be verified via the USDA Income Eligibility lookup (eligibility.sc.egov.usda.gov). NOTE: income_limit_amount reflects the 2026 national baseline 4-person figure; RI-specific county figures may differ.
• The limit applies to total household income, not only the borrower’s.
• The program lists a maximum household size of 8.
• 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 Guaranteed Loan Program (Rhode Island) caps the purchase price as follows: No set purchase-price or acreage limit; property must be modest, non-income-producing, and in an eligible rural area.

• Eligible property types include single_family, condo, townhouse, manufactured, and modular.
• New construction is eligible.
• Manufactured homes are eligible.

Where does it apply?

USDA Section 502 Guaranteed Loan Program (Rhode Island) is a federal program, so it is not limited to Rhode Island.

How do you apply?

Applications for USDA Section 502 Guaranteed Loan Program (Rhode Island) go through USDA Rural Development, Rural Housing Service (Single Family Housing Guaranteed Loan Program), through approved lenders, which publishes the current terms and the application steps on its own site.

1. 1

   Contact USDA Rural Development, Rural Housing Service (Single Family Housing Guaranteed Loan Program), through approved lenders to reserve funds

   Funds are reserved through Applications accepted on an ongoing basis from approved lenders October 1 - September 30; borrower applies through a USDA-approved lender, 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.