Now may be the best time to consider buying a home. Low interest rates, an improving housing market and a good supply of homes for sale make this a buyer's market.
Now may be the best time to consider buying a home. Low interest rates, an improving housing market and a good supply of homes for sale make this a buyer's market. Nonetheless, homebuyers may still have concerns about credit and financing that are keeping them from taking advantage of these opportunities. The solution could be a federal program that can help take the worry out of purchasing a home for buyers with average to low income in communities with up to 10,000 residents.
USDA Rural Development has two home loan programs available to buyers looking for homes in communities with less than 20,000 people. The agency can guarantee home loans with homebuyers' lenders, ensuring they get the most favorable rates and terms. While generous income limits apply, the only limit on the price of the home in the guarantee loan program is the borrowers' ability to pay.
The agency also makes loans directly to home buyers with lower incomes to buy or build a home. The program also has flexible credit standards and possible payment subsidies. Income, price and home size limits apply. Neither program requires a down payment or mortgage insurance premiums while offering the security of a long term loan with a fixed interest rate.
"Working with Rural Development can help you be a smarter homebuyer," said Rural Development Area Specialist Jeff DeSplinter. "Our direct home loan program costs less than similar programs and we can help buyers, one-on-one, through the home buying process.
The staff in the Rural Development office in Princeton, Ill. has help hundreds of area homebuyers finance the home they want. Recently they helped Inga Svoboda buy just the right house. She wanted a home for her and her son that gave them more space for less money than the rent she paid for their two bedroom apartment in Andalusia, Ill. in Rock Island County. She wanted a space they could make their own that was close to family, work and school.
She found the right home in nearby Taylor Ridge, but knew she couldn't afford to buy a home in that school district with a conventional loan. Svoboda heard about affordable Rural Development home loans from a friend, and she called the agency. She had never bought a house on her own before, but she found it easier than she thought by working with them.
"They answered all my questions and were extremely helpful and nice," Svoboda said. "They always returned my phone calls and e-mails."
As a self-employ single mom, Svoboda has just the right place now with more room to care for a relative and yard that's perfect for Kurt. He is autistic and noises and smells bother him, which was a problem when they lived in the apartment. "Working outside and having a yard to play in has made a big difference in him."
Home buyers concerned about not having saved enough money for a down payment or worried about what kind of mortgage is the best for them can contact the Rural Development office in Princeton by calling 815-875-8732 ext. 4.
"If you are looking for your first home or a better home with little out-of-pocket expense," DeSplinter said, "ask your lender about a Rural Development guarantee or contact the Rural Development office directly."
Rural Development has more than 40 programs that foster growth and economic stability in rural areas by providing affordable financing and technical assistance. In addition to rural housing, support is available for regional food systems, broadband and biofuel infrastructure, business development and community needs. More information on USDA Rural Development programs is available on the web at www.rurdev.usda.gov/il.