Thursday, December 12, 2013

Section 502 Single Family Housing Direct Loan Program Section 502 Rural Housing Guaranteed Loan Program

The USDA Rural Housing Service has various programs available to aid low- to moderate-income rural residents to purchase, construct, repair, or relocate a dwelling and related facilities. USDA rural housing loan programs allow qualified homebuyers to get loans with minimal closing costs and no downpayment.



Section 502 Rural Housing Guaranteed Loan Program
Under the Guaranteed Loan program, the Rural Housing Service guarantees loans made by private sector lenders. A loan guarantee through RHS means that, should the individual borrower default on the loan, RHS will pay the private financier for the loan.
The purpose of this loan program is to enable eligible low- and moderate-income (up to 115 percent of the Area Median Family Income) rural residents to acquire modestly priced housing for their own use as a primary residence. The program is available for the purchase and repair of existing and newly constructed dwelling.
There is no required down payment, but families must be able to afford the mortgage payments, including taxes and insurance. In addition, applicants must be without adequate housing and be unable to obtain credit elsewhere, yet have acceptable credit histories.
Loans are made for up to 30 years

Section 502 Single Family Housing Direct Loan Program
Under the Direct Loan program, individuals or families receive direct financial assistance directly from the Rural Housing Service in the form of a home loan at an affordable interest rate. These loans may be made to eligible applicants to buy, build, repair, renovate, or relocate homes, to provide related facilities, or to refinance home debts under certain conditions.
Applicants for direct loans from RHS must have very low or low incomes. Very low income is defined as below 50 percent of the Area Median Income (AMI); low income is between 50 and 80 percent of AMI. There is no required down payment, but families must be able to afford the mortgage payments, including taxes and insurance. In addition, applicants must be without adequate housing and be unable to obtain credit elsewhere, yet have reasonable credit histories.
Loans are typically made for up to 33 years (38 for those with incomes below 60 percent of AMI and who cannot afford 33-year terms). 




--
Joel Lobb (NMLS#57916)
Senior  Loan Officer
502-905-3708 cell