Lender Qualifications & Loan Terms (USDA Section 538)
- Eligible Lenders: Loans must be originated by a USDA-approved commercial lender, mortgage banker, housing finance agency, or state agency.
- Loan-to-Value (LTV) Limits:
- For-profit entities: Up to 90% LTV.
- Non-profit or public entities: Up to 97% LTV.
- Loan Amortization & Term: Maximum 40-year term and amortization period.
- Interest Rate Options: Fixed or variable market rates, negotiated between the developer and lender. Options exist for a USDA Interest Rate Buydown to lower annual debt service.
- Property Size: Projects must involve at least 5 housing units.
Contact Information
USDA Rural Development — Michigan State Office
- Address: 3001 Coolidge Rd, Suite 200, East Lansing, MI 48823
- General Line: (517) 324-5100
- Multi-Family Housing Direct Inquiries: (800) 292-8293
- Multi-Family Housing Email: MultifamilyHousing@usda.gov
Complementary State Agency (MSHDA)
Multi-family developments using USDA funds often stack financing with Low-Income Housing Tax Credits (LIHTC) or bond financing managed at the state level:
- Michigan State Housing Development Authority (MSHDA) — Rental Development:
- Phone: (855) 646-7432
- Email: MSHDA-RD@michigan.gov
Are you planning this project as a for-profit commercial development, or are you partnering with a non-profit/public entity?