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On-Lot Sewage Disposal Loans

Low-cost financing for wastewater systems across the Commonwealth. In some parts of the Commonwealth, particularly rural areas, it may be more cost-effective for individual home owners to use their own on-lot sewage disposal systems rather than incur the high costs of constructing long collection lines to service widely scattered properties. As with larger systems, however, these individual on-lot sewage disposal systems may require improvement, repair or replacement to meet public health and environment standards.


  1. All citizens of the Commonwealth, with limited exceptions. Detailed information eligibility requirements can be obtained from any of the agencies involved in the program by either sending in an information request form, or by calling the numbers listed in this section. Alternatively, eligibility information can be obtained from a participating local lending institution or your local Sewage Enforcement Officer.
  2. Family Income must not exceed 150 percent of the statewide median household income, adjusted annually for inflation. The applicable maximum through December 31, 2012 is $78,808.
  3. All areas are eligible for project location unless a community wastewater collection and treatment system is either in place or will be constructed in the next five years.

Eligible Uses

  1. Rehabilitation, improvement, repair or replacement of an existing system located on a single family, owner occupied property which is the primary resident of the owner.
  2. Project costs may include construction fees and costs, permit fees, loan orgination fees and legal fees.

Ineligible Uses

  • Construction may NOT begin on repair or replacement project before receiving approval of the loan. Projects will be ineligible for funding from this program if construction starts prior to approval.


  1. Loans up to a maximum of $25,000.
  2. Loans at an interest rate of 1% plus a servicing fee of .75% per annum.
  3. Loans must be secured through financial ability to repay loan must be demonstrated through credit worthiness.

Terms and Conditions

  1. Loans must be secured by a mortgage on the borrower's home.
  2. The maximum term of a loan is twenty years and loaned repayment commences within sixty days after the date of loan closing.
  3. Loan must be immediately repaid in full if the property on which the project is located is either sold or transferred.
  4. Loan origination and servicing fees will be also charged in connection with a loan.
  5. A basic requirement of the program is that you keep your upgraded or new on-lot sysem in good repair, have it pumped out regularly and ensure that it does not malfunction and fail to adequately treat wastewater or cause a public health hazard. A pumping frequency schedule and reporting requirements will be included in your loan agreement.

How to Apply

  1. Contact a participating local lending institution to see if you qualify for credit approval of a loan. See the PHFA Participating Lender List below or call PHFA at 1-800-822-1174 for a current listing.
  2. An application fee of $65 will be collected, but it is a reimbursable fee if your loan is closed and disbursed.
  3. If credit approval is given, contact your municipal officials and have them sign a standard form certifying that your proposed project is not in an area which is currently served by public sewers and will not be served by public sewers within 5 (five) years.
  4. If municipal officials concur, contact the sewage enforcement officer (SEO) serving your municipality to determine if a repair or replacement of your on-lot system is permit-able under all applicable Commonwealth regulations.
  5. If a repair or replacement is permit-able, the system must be then designed, and the designing SEO or professional engineer (PE) must certify that the system proposed is the most cost-effective system available for your property.
  6. Your municipality's SEO then reviews the design, and if acceptable, issues a permit for the system.
Special Instructions and Guidelines

For additional assistance call
  • PHFA at 1-800-822-1174
  • Department of Environmental Protection (717) 787-3481 or your local DEP office