Many Americans live in rural areas, and some of these small towns are low income or very low income areas. In 1949, the U.S. Department of Agriculture (USDA) authorized a rural housing grant program under Section 533 of the Housing Act of that year. Property owners can apply for these 533 grants, otherwise known as Housing Preservation Grants, to revitalize and repair their homes or rental properties. Native American tribes, nonprofit organization and local governments can also apply for funds to rehab multifamily rental units.
Identification
The Housing and Community Facilities Programs (HCFP) is the agency that administers the USDA Rural Development Housing Preservation Grants. Homeowners can apply for these Home Preservation Grants to modernize and update their aging homes and rental properties. For 2007, the U.S. government appropriated $10 million for the Housing Preservation Grant program.
Eligibility
To be considered a "rural" area, the town must have less than 20,000 people. To be eligible for the 533 grants, your income must fall below 50 to 80 percent of the median income in your local area. Also, the property must be occupied for at least one year before you can receive the grant. Renters can also apply for the grant, but their lease must still have at least five years left in the contract. The renter and the landlord must also come to an agreement that the new improvements will not cause the current rental price to increase.
Application Process
To apply for the Home Preservation Grants, you can send your application to the state or field director of the HCFP or the local Rural Development office in your area. However, many individuals apply through local public agencies or private nonprofit groups, which often package the applications for submission to the HCFP. These organizations are certified and trained by the HCFP. They screen applicants, determine financial eligibility and help the applicant complete the application process.
Considerations
The HCFP is supposed to respond to all applications or pre-applications within 30 days. However, obtaining a 533 grant can be difficult since each state must follow a specific mathematical formula to calculate eligibility. Individuals or organizations will receive the funds directly from HCFP when the application is approved. After you receive the funds, you must spend the money within two years on your renovation project. You maybe also required to account for the money spent and to submit a final report to the HCFP.
Benefits
Grant recipients can use the funds for a variety of uses. Some common uses for grant money include sewer, sanitary and waste water system repair; heating and cooling system repair; and foundation, roof or structural support repair. Homeowners can also add access for disabled persons, install more energy efficient windows, doors or insulation, or remove hazardous materials. Grant funds can also be used to update homes listed on the National Register of Historic Places or manufactured houses.
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