Water and Waste Disposal Loan Guarantees

USDA State Offices

Water and Waste Disposal Loan Guarantees help private lenders provide affordable financing to qualified borrowers to improve access to clean, reliable water and waste disposal systems for households and businesses in rural areas.

Borrowed funds may be used to construct or improve facilities for:

• Drinking water
• Sanitary sewers
• Solid waste disposal
• Storm water disposal facilities

Depending on the circumstances, some funds may also be used for:

• Guarantee and lender fees
• Legal and engineering fees
• Land acquisition and equipment
• Additional borrower labor to install and extend service
• Initial operating expenses
• Capitalized interest
• Purchase of existing facilities to improve service or prevent loss of service
• Debt refinancing in some instances

Loans guaranteed through this program are serviced through the private lender that makes the loan, just as they would be without a guarantee.

Private lenders may apply for a guarantee on loans they make to eligible borrowers who are otherwise unable to obtain commercial credit on reasonable terms.

Eligible borrowers include:

• Public bodies
• Nonprofit businesses
• Federally recognized tribes

Eligible areas include rural areas and towns with populations of 50,000 or less, tribal lands in rural areas, and colonias (check eligible addresses).

The loan guarantee percentage for Fiscal Year 2024 is 80% and for Fiscal Year 2025 is 90%.

Visit the streamlined OneRD Guarantee Loan Initiative website for detailed application information.

Lenders may contact a representative in the USDA State Office for additional details. Borrowers should ask private lenders if they participate in USDA loan guarantee programs.

OneRD Guarantee Loan Initiative Lender Guide