rural development loans: USDA Rural Development loans are back!
- 05/27/10 04:07 AM
The USDA issued a memo yesterday, May 26, 2010, reauthorizing the issuance of conditional commitments for USDA loans. What that means is that your better lenders (the ones that usually close USDA loans while funds are waiting to be allocated) will immediately be able to continue closing loans. The amount that has been authorized is $2.5 billion and it's expected that new funding will be available from Congress before this is exhausted (there are currently a few bills, but HR 4899 is the most likely to pass quickly- possibly by today). Do know this money comes at a cost. Per the memo, (11 comments)
The Mortgage Bankers Association reports that mortgage applications for the week ending April 9th are down almost 10% from the previous week. They go on to cite the recent increase in FHA upfront mortgage insurance as the main factor, and they likely have numbers to back up that statement. What the press release says is that a 19.1% decrease in "government purchase applications" fueled the drop, but do their numbers break down what specific programs were impacted most? My point is that as of last week most lenders in the country have given up on taking USDA Guaranteed Rural Development (0 comments)
Updated information- Check it out below I normally hate titles that are meant to scare people into reading but unfortunately this time there is no exaggeration to the severity of the issue. USDA Guaranteed Rural Development loans, one of the best low/no down payment financing programs left, has recently announced they expect to be out of the funds they use to guarantee loans by late April. If no action is taken by Congress to re-appropriate more funds then it will be the next budget year, after October, before we have this financing option again. But the Tax Credit deadline is looming (46 comments)
Last Friday the USDA formally announced it was entering its annual "roll over" of funding as of its new fiscal year October 1st. This mainly administrative action results in USDA's funding being delayed until it's made available through the General Accounting Office (GAO). This by no means indicates the USDA is out of funds! What it does do is delay funding for loans and guarantees. While there are still a number of lenders that can and do close and fund loans during this period, the vast majority of lenders do not. This doesn't mean your loan won't close, it just (39 comments)
The typically busy spring home buying season has sprung in Lake County which surpassed the 300 unit per month threshold topping out at 317 for the month of June, '09 as reported by the National Association of Realtors. Prior to this April had seen the best sales so far this year with 288 and the June sales blow away January's total of 187 sales. Sales are clearly trending upward with price and rate affordability playing a big role, coupled with the first time buyer tax credit incentive. While sales of single family homes under $50k took a sharp jump (2 comments)
rural development loans: USDA appraisal requirements changing July 01, 2009
- 06/26/09 08:37 AM
The last holdout- USDA- will be requiring the 1004MC addendum to the appraisal on all Rural Development loans effective July 1, 2009. Up to now they were the only loan program to not require it so the news certainly doesn't come as a surprise.
The memo from USDA states files in process prior to that date can be submitted without the 1004MC until July 31, 2009. After that all files must include the addendum. Personally I have not seen any negative impact from the inclusion of the addendum on FHA and VA loans, so I expect no negative repercussions from (3 comments)
Today the USDA announced it regular allocation of funding had been credited is now available for use. These are the funds that can be used to guarantee refinance loans (you can only refinance a current Rural Development loan) and homes with pools. Remember pools still require a special exception t be approved. If the appraised value of the home doesn't exceed the purchase price by the value given to the pool, your buyer would have to pay the difference. Talk to a knowledgeable RD lender for more details. Also, if you are considering purchasing a home and using the (2 comments)
It's been confirmed! The income limits in Lake County (and the entire Orlando area) for USDA Guaranteed Rural Development loans will go up to $70,750 for households from 1-4 persons and $92,400 for households from 5-8 persons. No false start anymore folks. We can start taking and processing applications immediately but cannot submit them to the USDA until 04/20. Folks don't take this lightly. I did my preliminary research on this change when it was first announced and discovered EVERY FHA deal I had done would have qualified for RD. Why is this a big deal? RD has no (0 comments)
rural development loans: Rural Development loans not jumping on the appraisal change bandwagon
- 04/07/09 08:10 AM
I just confirmed that the USDA will not be requiring the new 1004MC form for their appraisals. This in spite of the fact that Fannie and Freddie, FHA/HUD and the VA are requiring them. That effectively makes RD loans the only ones NOT requiring this additional info. Coupled with the fact you can still order your own appraisals through local expert appraisers, not some national company, this makes the RD loan program mighty attractive! As if you didn't have enough reasons before to like the program- count these benefits on top of such attractive features like: 100% financing, that can include closing (0 comments)
Those who know me know I don't usually repeat hearsay. I like to confirm things beyond a shadow of a doubt before writing about it but this is just too important not to share. I heard from a reliable source today that because of some wording in the new funding allocation for USDA RD loans that they were no longer accepting pools under any circumstances. Those of us familiar with RD loans know there has always been an exception process to approving pools. It seems that may now be gone. My trusted source in Florida is out until tomorrow so (8 comments)
Pursuant to my sources at the USDA it will be taking about another two weeks for the funding allocated by the recent economic stimulus bill to trickle down to retail levels. For those who are seeking a Guaranteed Rural Development loan from a lender such as myself, this should not affect you since we are still funding loans in anticipation of the money we know is coming. If you are working with another lender who is not funding loans, it's probably worth it to wait with them as opposed to starting over with another lender. Do know, however, they have (8 comments)
rural development loans: The $8000 First Time Buyer’s Tax Credit- what are you going to do about it?
- 02/18/09 12:49 AM
OK, Obama signed it yesterday making it law. All of us in the industry wanted more and feel the economic stimulus package passed us by, for the most part. Yea, we got more money for RD loans and don't think the higher FHA loan limits is insignificant; but we needed more. At the top of it all we got the tax credit that doesn't need to be paid back. So what can we do with that? We can sit back and complain about it. We can emphasize the negative, that you have to pay it back if you rent or sell (5 comments)
rural development loans: Part 2- Economic Stimulus Package can be law by as early as next week. What does it mean for us?
- 02/13/09 04:13 AM
It's Friday the 13th and Jason is walking the hallowed halls of Congress making laws I personally hope we don't come to regret. We have all heard many conflicting reports on this legislation but sketchy details have been confirmed. What does it all mean to us and our industry? As of this time the bill and much of the supporting documentation is available at the following link: http://www.conferencereport.gpoaccess.gov/DefaultN.aspx?AspxAutoDetectCookieSupport=1 It proposes keeping the existing first time buyers tax credit program intact with the following changes: 10% to $8k credit max waives the repayment provision on homes purchased after 12/31/08 (it is retroactive!) (9 comments)
IF YOU ARE FOLLOWING THIS POST PLEASE LINK OVER TO PART 2 HERE FOR AN UPDATE NEW UPDATE-as of 10a EST, 02/13/09- It is Friday the 13th and some very scary things may be happening today. The summary is available and basically confirms what we have been hearing in the press. The bill should have these points: 10% to $8k credit max waives the repayment provision on homes purchased after 12/31/08 (it is retroactive!) extends the date to homes purchased on or before 11/30/09 allows for recapture of the credit within 36 months if the home is sold or ceases (37 comments)
We have all been anticipating changes in the income guidelines for RD loans to be increased, however today the USDA announced it will not be making those changes until at least March 20, 2009. The changes would allow families from 1 to 4 members to qualify at the 4 person income limit ($70,750 in most areas of Florida), and families from 5-8 members could qualify at the 8 person income limit ($93, 400 respectively). This delay comes just as we were expecting the change to take place so it has the potential to impact the plans of many buyers. Although (0 comments)
rural development loans: RD loans no longer underutilized...latest info on program funding
- 01/05/09 11:55 PM
The USDA sent out a notice regarding availability of funds yesterday and estimating funding for the current period would be exhausted by January 9, 2009 "if not sooner". They site demand at historic highs as the reason for the shortfall, and this comes as no surprise to those of us that have been using the program. They are clear to state, however, that they will continue to take and process applications and a source of mine expects additional funding to be online shortly after the inauguration of President Elect Obama. That said the delay in funding should be short lived. In the (7 comments)
USDA Rural Development loan expert Sue Botelho was quoted in an excellent article regarding the increased popularity of RD loans in the Wall Street Journal today. Sue has done a great job getting word out regarding the strengths of the program and its zero down features. Congratulations Sue! The article quotes other sources and demonstrates the program's effectiveness but it also stresses that as the program becomes more popular, funding will be an issue. Unlike FHA and VA this loan program is solely funded by the government. Although losses have been in line with or better than other government (6 comments)
The most recent sales statistics for Lake County, Florida confirm what we all know, that buying a home is getting much more affordable. With home prices declining better deals are being had by those willing to go after them. October sales increased 5.5% over September and of the single family homes sold a whopping 69.8% were under $200,000! When you include homes up to $250,000 number jumps to 83.5% of all sales! It goes to show there are great deals happening out there when for the first time in many years cash sales outnumbered any other type of financing! (0 comments)
I was reminded how good it is to be a mortgage lender yesterday when I had the fortune of helping a young couple, married only two and half years, achieve their dream. They came to me looking to buy and not knowing if they could. "Our credit is good" they said, "but we don't have much of it". "That's a good thing these days" I said, and we proceeded with qualifying them. Turns out their scores are in the 630's and good enough for the USDA Rural Development no down payment loan I was hoping to place them in. When (0 comments)
I was reminded how good it is to be a mortgage lender yesterday when I had the fortune of helping a young couple, married only two and half years, achieve their dream. They came into one of my Realtor's offices looking to buy and not knowing if they could. "Our credit is good" they said, "but we don't have much of it". "That's a good thing these days" I told them and we proceeded with qualifying them. Turns out their scores are in the 630's and good enough for the USDA Rural Development loan I was hoping to place them (14 comments)
Local information regarding Mortgage lending in Central Florida including Orange, Seminole, Osceola, Lake, Volusia and Marion Counties. Also providing up to date information on HUD and government loan programs, and first time buyer programs. I'm required to tell you I'm not acting on behalf of HUD/FHA or the US Government!