Section 502 Direct Loans are administered by the United States Department of Agriculture (USDA) Rural Housing Service for low income home building in rural areas. Section 502 direct loans are a means of thirty party financing for homes. The USDA establishes the note rate, which is the current mortgage interest rate. However, mortgage payments are based on the household's adjusted annual income and based on the specific financial circumstances of a family, and the government generally subsidizes this rate.
