USDA Section 502 Single Family Housing Direct Home Loans (South Carolina)

USDA Section 502 Single Family Housing Direct Home Loans (South Carolina) is a first mortgage for homebuyers in South Carolina, administered by USDA Rural Development. USDA Rural Development's Section 502 Direct Loan Program provides low- and very-low-income rural homebuyers with a subsidized fixed-rate mortgage and payment assistance that can reduce the effective interest rate to as low as 1%. No down payment is typically required. The program assists applicants who cannot obtain credit elsewhere. As of May 1, 2026, the base interest rate is 5.00%. Payment assistance reduces actual payment based on adjusted family income. Property must be in USDA-eligible rural area in South Carolina. No down payment typically required. Interest rate as low as 1% with payment subsidy. 33-38 year loan term. Available year-round. No pre-payment penalty. Funds can also be used to build or renovate. Funding comes from USDA Rural Development federal appropriations.

USDA Section 502 Single Family Housing Direct Home Loans (South Carolina) is a first mortgage and is repaid under the terms set by USDA Rural Development. Forgiveness and repayment terms are set by the program and can change — confirm them on the official program page before applying.

USDA Section 502 Single Family Housing Direct Home Loans (South Carolina) is open to homebuyers who will live in the home as their primary residence. Residency requirement: Must be US citizen, permanent resident, or eligible noncitizen. Applicants must demonstrate inability to obtain credit from other sources on reasonable terms. Cannot be suspended or debarred from federal programs. Payment assistance must be repaid (all or portion) when title transfers or borrower no longer occupies. Processing times vary by funding availability and demand. Contact SC USDA RD office for current waiting times. Applicants may use the USDA Self-Assessment Tool before applying at eligibility.sc.egov.usda.gov. Current rate effective May 1, 2026: 5.00% (check rd.usda.gov for updates).

USDA Section 502 Single Family Housing Direct Home Loans (South Carolina) limits household income to 80% of the area median income, which varies by county and household size. Adjusted income must be at or below the low-income limit for the area (generally 80% AMI for low-income; very-low-income = 50% AMI). Payment subsidy further reduces payments. Specific SC county limits at rd.usda.gov/sites/default/files/RD-DirectLimitMap.pdf. Area median income figures are published by HUD and updated annually, so check the current table for the county before relying on a number.

USDA Section 502 Single Family Housing Direct Home Loans (South Carolina) caps the purchase price as follows: Cannot exceed applicable USDA area loan limit (varies by county in SC). Eligible property types include Single Family. New construction is eligible. Manufactured homes are not eligible.

USDA Section 502 Single Family Housing Direct Home Loans (South Carolina) serves homebuyers purchasing anywhere in South Carolina. The program targets specific areas: USDA-designated rural areas in South Carolina (verify at https://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do).

Applications for USDA Section 502 Single Family Housing Direct Home Loans (South Carolina) go through USDA Rural Development, which publishes the current terms and the application steps on its own site. Hey Prescott is not a lender and does not accept applications; this page describes the program so a homebuyer can take it to a lender or housing counselor.