Michigan Septic Replacement Loan Program: who qualifies and how it works

What the program is

The Septic Replacement Loan Program is run by EGLE and Michigan Saves, a nonprofit green bank that EGLE contracts to administer the lending. EGLE launched it in May 2024 with $35 million appropriated under Public Act 53 of 2022. It lends up to $50,000 to replace failing or near-failing septic systems. EGLE’s July 2025 release said more than 150 contractors had been authorized, that 220 or more loans totalling $3.8 million had been approved, and that 184 systems had been installed as of June 30, 2025. Those are the latest program figures published, and they will be out of date by the time you read this.

There are two tiers. Tier One is income-based, up to $30,000 per project at a fixed 1 percent, with terms of up to ten years. Tier Two is market-based and goes up to $50,000. Michigan Saves lists Tier One loans from $1,000 to $30,000 and states income limits that start at $47,880 for a one-person household. That figure appears on Michigan Saves’ own page, a nonprofit’s page rather than a government’s, and the income table and rates may change, so check the current numbers there.

Who qualifies and what the rules require

The system has to be failing or near failing, and the local health department has to document it. The work must be permitted by the local health department under EGLE’s Program Minimum Standards, and a Michigan Saves authorized contractor must install it. Michigan Saves requires those contractors to be registered with the State Corporations Division, to carry insurance and to be registered or certified by the local health department or sewer authority where that applies. Documentation is the gate: a county that has seen no failure on your property has nothing to document, which is why the first call comes first. EGLE defines failure broadly: a backup into the building, a discharge to the ground surface, contaminated water, a bypassed part, a missing absorption system or a structurally failed tank all count, as the failure signs guide explains.

Eligible costs include the system evaluation, the design, the pumping and the installation. Pumping must be done only by a licensed septage waste hauler, and EGLE requires its pump record, form EQP1731, when a tank is reused or pumped under the program.

What the Minimum Standards add to a Michigan installation

The standards bind loan-funded work only, not every Michigan system, but they set a visible bar. The installation must include a riser to grade and an effluent filter on pressure or proprietary systems, and the tank must be sized by local code. A Category 1 design needs 18 inches of non-mottled soil. A Category 2 design relies on performance-based treatment, must be certified to NSF Standard 40, and must be operated and maintained for life, with reports at least every three years recorded against the property. The watertight riser to grade is required on septic tanks, secondary treatment tanks and pump chambers, along with a secured secondary safety component, and reused tanks must be upgraded. The standards use 48 or 36 inches of separation depending on distribution type, where the state Criteria require 4 feet between the trench bottom and the high groundwater. Ask your installer which standard applies to your design.

How counties point to it

Several counties link the program from their septic pages. Genesee County lists it with USDA repair loans and grants and State Emergency Relief, and says its health department does not endorse any of them. Jackson, Ingham, Van Buren/Cass, Calhoun, Lenawee, Eaton and Ionia counties link it as well, and Calhoun’s and Lenawee’s pages link a program flyer, so ask those counties for it. The county is also where the documentation starts, so ask whether your health department will write the failure finding before you hire a contractor.

Order of operations

First, get the failure documented by the county. Second, ask the county about permit steps and fees: the septic repair page lists the published fees. Third, ask whether a public sewer is available, since that can change the repair: the septic versus sewer guide covers it. Fourth, collect bids from authorized contractors and check that each bid names the standard, the riser, the filter and the pump record. Ask Michigan Saves how long review takes, and take nothing here as a promise that you will qualify.

What to ask each contractor

Start with whether the firm is a Michigan Saves authorized contractor, then ask if the county registers it or certifies it where that applies. Then pin down which design category the bid assumes, what the riser and secondary safety component are, whether an effluent filter is included, and who files the county permit. Find out who completes the pump record, where the paperwork goes, and how long the contractor expects the county permit and inspections to take in your county. Have each bid itemized so you can compare them line by line, and keep every county inspection record, because the health department’s documentation of the failure and its permit approval are what the program’s rules turn on.

Keep the county’s failure documentation, the permit, the inspection records and the pump record together in one folder, since each is a document the program’s standards refer to. Ask the contractor for copies as the work proceeds and not at the end.

What it will not cover, and the missing numbers

The program is aimed at failing or near-failing systems, so a routine pumping on a working system is not what it is for, though pumping is an eligible cost when it is part of a funded project. No source we can cite gives a typical approval time or the share of applications approved, and we found no EGLE price list for contractors, so the amounts above are loan limits and not cost guidance. For cost evidence, EGLE says replacement septic systems cost $8,000 to $30,000, and EPA gives $5,000 to $15,000 to repair or replace a conventional system nationally. Both are in the installation page cost table with the county permit fees.