USDA Rural Development in Illinois: Not a Pipe Dream

The federal USDA Rural Development Program is designed to help improve housing access and financial support in targeted rural areas across the U.S. This government provides financial support in a number of ways, including direct loans to eligible recipients for home purchases and property purchases in the same regions. The beauty of the federal program comes in the multiple benefits that it allows, some not being available through normal home loan programs available elsewhere.

Home Loans

In terms of direct housing loans for those seeking purchasing financial assistance, the USDA program works with and covers are number of different eligible groups. These can include VA loans, Ginnie Mae and Fannie Mae underwritten loans, farm loans, and direct Rural Development loans. The loans provided follow a traditional 30-year, fixed rate approach, similar to conventional home loans otherwise available on the private side. The borrower has to meet income eligibility, appropriate credit scores and financial background requirements. There are also loan to income ratios that must be met as well. But many homes are eligible for rural development financing.

Low Income Assistance

Where prospective borrowers are unable to meet normal income requirements due to low income status, the USDA offers Section 502 home loans tailored to address these situations. The 502 loans, a different category of USDA Rural Development financial assistance, allow improvement of an existing home that may be suffering from relocation or renovation needs due to a lack of funds. The loans provided typically last 30  to 33 years in terms of a repayment period.

Site Loans

Where a family wants to custom build a home, which is common in rural areas, the USDA Rural Development program also provides financing for these efforts as well. Most eligible applicants tend to be low to middle-income earners. Dubbed section 523 and 524 loans, one type helps with site acquisition while the other is specifically targeted for assisting low-income families with the same. These loans last for a short payment period, two years, at which time the construction is completed and refinanced into a traditional home loan, along with the remaining balance of the 523/524 loan.

Notable Benefits of the USDA Program

Some of the interesting aspects of the USDA Rural Development program include how the loans are designed to work for eligible participants who are approved. First off, the loans can be for 100 percent of the value of the property involved, based on licensed appraisal. Second, in some cases, depending on the details, a borrower could actually leverage an extra two percent to use for specific repairs and improvements on existing homes. As long as the property is situated in areas considered rural per the USDA’s definitions, the home or land will be eligible for participation.

Conclusion

AmeriFirst Home Mortgage is a leading facilitator of USDA Rural Development loans, helping first time home buyers and families secure homes and properties in designated rural regions with government funding help. Because AmeriFirst has the necessary expertise in understanding how the USDA Rural Development loan programs work, they are able to successfully guide applicants and borrowers into the best program that meets their needs. Obviously, as discussed above, their are a number of options available to borrowers, but some fit a borrower's need better than others. With AmeriFirst's knowledge and skill, the right loan program can be matched to the applicant, meeting the financing need spot on. This increases the probability of approval as well as preparation of the loan application to accurately meet loan approval criteria.

So you or someone you know is considering buying a home or property in rural Illinois, consider the opportunities available through the USDA's home loan programs. Amerifirst staff can discuss all the available options and how they can best work for your needs.

USDA Rural Development is just one choice for buying your home in Illinois. Download "The Only Mortgage Loan Options Guide You Need" to find out what else is available to you in today's housing market. Click the button below.