PROGRAM DESCRIPTION: Home loans designed for moderate income families (115% or less of county median income) who have limited downpayment capacity. Loans are processed by the lender, guaranteed by the United States Government and may be sold into the secondary market.
TYPE OF ASSISTANCE: Preference to first time homebuyers. Maximum ratios are 29% principal, interest, taxes and insurance; 41% monthly obligations to total income; and up to 100% loan to value.
ELIGIBILITY ASSISTANCE: 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 a serious lack of mortgage credit for low and moderate income families as determined by the Secretary of USDA. Families must be without decent, safe, 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: Funding is based upon annual appropriations.
INTEREST RATE: Negotiated between the lender and the borrower (cannot exceed Fannie Mae's 90 day actual/actual rate plus basis points).
TERMS: 30 year fixed mortgage.
COLLATERAL: Mortgage on real estate financed.
FEES: Guarantee Fee of 3.5% of loan amount is charged to the lender.
CREDIT REQUIREMENTS: A credit history which indicates a reasonable ability and willingness to meet obligations as they become due, generally meaning no late payments within the last 12 months from the date of application and a three year period from bankruptcy discharge or foreclosure.
CONTACT: Applications are made to lenders throughout the state. For a listing of Approved Lenders, 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.
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Revised on: October 2010