Des Moines, Iowa, Mar 13, 2012 -- In my position as USDA Rural Development State Director I travel extensively around the state talking with rural residents about what makes rural Iowa great including our people, the sense of community and the rural ethic. I also hear about the challenges small towns are facing.
One of the challenges mentioned most often is housing and access to a safe, affordable place to live. That makes sense given the state of the housing market and the lingering effects of the burst housing bubble and ensuing recession.
But things are looking up. The Iowa Association of Realtors is reporting seven consecutive months of increasing homes sales across the state. In January, home sales jumped almost 10 percent from the same month in 2011.
I would encourage people who live in rural communities to consider one of USDA Rural Development’s no-down-payment programs when buying a home. In 2011, our agency helped 2,500 families living in rural Iowa communities become homeowners, many of them first-time home buyers.
In his State of the Union address earlier this year, the President unveiled a blueprint for an America Built to Last that calls for action to help support a housing market recovery. This initiative is part of President Obama’s ongoing efforts to help middle-class families, create jobs and strengthen the economy.
In rural communities, there are two ways would-be home buyers can work with USDA.
The first is a federal guarantee on home loans made by approved lenders to moderate income households in eligible rural areas. The loan provides qualified borrowers up to 100-percent
financing on a 30-year fixed-rate loan, while eliminating the need for a down payment or private mortgage insurance.
The USDA also has a direct home-loan program where we serve as the lender and provide 100-percent financing on home loans to eligible rural residents.
For both programs eligible homes must be located in a community of 20,000 persons or less. The home can be existing or new construction. Existing homes must be structurally sound. Also, the property cannot have any income-producing outbuildings.
In most cases, a family of four with an adjusted annual income of up to $74,750 may qualify for the guaranteed home loan program. If that same family’s adjusted annual income is less than $47,450 they may also qualify for a direct loan.
Through these housing opportunities, as well as our many other job-creation, community facility and economic-development programs, USDA and the Obama Administration are committed to ensuring that small towns and rural communities thrive into the future.
For more information about finance programs through USDA Rural Development, please visit www.rurdev.usda.gov/ia.
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By Bill Menner, USDA Rural Development State Director in Iowa