PROGRAM DESCRIPTION: Housing loans designed for low to very low income families (80% or less of county median income).
TYPE OF ASSISTANCE: Home ownership loans may be used to buy, build, improve, or repair rural homes.
ELIGIBILITY REQUIREMENTS: Must be a rural resident or living in a town with a population of 10,000 or less, or in certain conditions, a town of 20,000 or less that is not contained in a Metropolitian Statistical Area (MSA) and has serious lack of mortgage credit for low and moderate income families as determined by the Secretary of USDA. Families must be without decent, safe and sanitary housing, unable to obtain all of their needed credit from other sources, and have sufficient income to cover house payments, taxes, insurance and necessary living expenses.
FUND AVAILABILITY AND MAXIMUM AMOUNTS: Funding is based upon an annual appropriation. Loans may be made for up to 100% of the appraised value. Loans may be made in combination with another lender contributing up to 40% or more of the loan amount on a first mortgage basis, with the balance from Rural Development on a second mortgage. The Rural Development loan or portion of the loan may be subsidized based on financial need in order to show repayment capacity.
INTEREST RATE: Current interest rate is used. When a subsidy is in effect, the interest rate may be reduced to as low as 1% A.P.R. on Rural Development's loan or portion of the loan.
TERMS AND COLLATERAL: Maximum repayment period is typically 33 years, under certain conditions a 38 year term is available. Collateral is mortgage on real estate financed.
FEES: Applicant pays the credit report fee, and if a loan is made, the cost of a real estate appraisal and loan closing costs.
CREDIT REQUIREMENTS: Good credit history is required.
For assistance, please contact the Area Office which serves the area you are interested in, or Mel Ellis, Program Director. Mr. Ellis can be reached at 919-873-2060 or by email:firstname.lastname@example.org.
Please send any comments or suggestions to:
Revised on: June 22, 2004