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USDA Section 502 Direct Single Family Housing Loan (South Dakota)

USDA Rural Development - South Dakota State Office · Huron, South Dakota

Last verified
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Assistance

100%

Of the purchase price, as the program sets it

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

USDA Section 502 Direct Single Family Housing Loan (South Dakota) is a first mortgage for homebuyers in Huron, South Dakota, administered by USDA Rural Development - South Dakota State Office.

  • The USDA Section 502 Direct Loan Program assists low- and very-low-income applicants in obtaining decent, safe, and sanitary housing in eligible rural areas of South Dakota by providing up to 100% financing (typically no down payment) plus a 'payment assistance' subsidy that temporarily reduces the mortgage payment based on adjusted family income. South Dakota participates in the Section 502 manufactured-housing and self-help pilots.
  • Up to 100% financing, typically no down payment.
  • Payment-assistance subsidy reduces the effective rate to as low as 1%.
  • Loan terms up to 33 years (38 in some very-low-income cases).
  • 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 (South Dakota) provides assistance worth 100% of the purchase price, as set by the program.

  • Award tiers: Direct loan with payment-assistance subsidy scaled to adjusted family income.
  • Buyer contribution: Typically no down payment required.
  • Amounts are the program's published maximums, not an offer — USDA Rural Development - South Dakota State Office determines any individual award.

Do you have to pay it back?

USDA Section 502 Direct Single Family Housing Loan (South Dakota) is a first mortgage and is repaid under the terms set by USDA Rural Development - South Dakota State Office.

  • Repayment is triggered by Payment subsidy subject to recapture: repay all or part when title transfers or 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 (South Dakota) is open to buyers who will live in the home as their primary residence.

The program requires

  • The home is occupied as a primary residence
  • DRAFT (dpa-gap-finder 2026-06-14): pending review. Loan term: Up to 33 years (up to 38 years for some very-low-income borrowers).. Adjusted income at/below the area low-income limit; property in an eligible rural area and modest in size; primary residence; willingness/ability to repay; generally unable to obtain a loan elsewhere. Payment subsidy subject to recapture. Could not confirm exact values: county income-limit amounts, max DTI, min credit score, area loan limits, SD state-office phone, education requirement.

These are the program's own published rules, not a decision about any individual — the administering agency and a lender determine who actually qualifies.

What are the income limits?

USDA Section 502 Direct Single Family Housing Loan (South Dakota) sets its income limit as follows: Adjusted household income at/below the applicable area low-income limit (limits vary by SD county and household size per USDA income-limit tables).

  • 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 (South Dakota) caps the purchase price as follows: Property must be modest in size for the area and within USDA loan limits; no single statewide purchase-price cap.

  • 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 (South Dakota) is a federal program, so it is not limited to South Dakota.

How do you apply?

Applications for USDA Section 502 Direct Single Family Housing Loan (South Dakota) go through USDA Rural Development - South Dakota State Office, which publishes the current terms and the application steps on its own site.

  1. Contact USDA Rural Development - South Dakota State Office to reserve funds

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

  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.

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