#usda loan program
USDA Sec. 538 Loan Program
New Construction or Substantial Rehabilitation
USDA Section 538 Loan Program
90% Federally-Guaranteed Financing
The goal of the USDA Section 538 Loan Program is to encourage commercial financing to foster the development and rehabilitation of low income rental housing in rural areas that is affordable and competitive in the market.
Through a two stage application process, we the lender, will guide and assist you to ensure the packages are properly prepared for the USDA. The first step is a quick, no-cost, pre-application package called the a “NOFA (Notice of Funds Available) Response”.
Upon USDA approval of the NOFA, the second step is a comprehensive application review that requires the borrower to pay a $3,500 loan application fee.
Once the USDA has reviewed and approved the application, they issue their firm commitment known as a Conditional Commitment. The entire process typically takes 45 – 120 days depending on the state office.
The benefits of the USDA Section 538 Loan Program include: