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Tuesday, May 18, 2010

USDA Funds availability

USDA Home Loan Summary
•Available for Purchase of Pre Existing or New Homes
•Refinances are only allowed if your current Mortgage is a USDA Home Loan
•Available in Rural Areas only
•Borrowers occupy the property, no investment properties
•Borrowers must meet USDA’s Credit Eligibility Guidelines
•Borrowers must meet the USDA’s Income Eligibility Guidelines.
•30 Year Fixed Interest Rates are available
•No Mortgage Insurance Premiums

Following recent legislative actions to address the funding shortfall in the USDA Section 502 Guaranteed Rural Housing Program, USDA Rural Development announced on May 11, 2010 that the Agency would continue to accept and process application packages. As had been done similarly when program funds were not available, USDA Rural Development advised loan approvals (Conditional Commitment: RD Form 1980-18) issued during this time would be “subject to the availability of funds and Congressional authority to charge a 3.5 percent guarantee fee for purchase loans and a 2.25 percent guarantee fee for refinance loans”.

On May 12, 2010 USDA Rural Development issued an announcement with the purpose of recalling and voiding this earlier guidance that was released on May 11, 2010. This second announcement dated May 12th also stated that additional guidance would be released by USDA Rural Development within the next 24 to 48 hours.

As of today, no such guidance or revision has been issued by USDA Rural Development.

At this time, we are only able to confirm that all general funds have been exhausted in the USDA Section 502 Guaranteed Rural Housing Program.

There has been no direction given by USDA Rural Development regarding loans in process that were not obligated by USDA Rural Development prior to the exhaustion of funding, or USDA Rural Development’s ability to accept new files.

We ask that you share this information with your loan origination and processing staff.

Please know that we share your concern for this situation, and we will send an announcement once information is made available by USDA Rural Development.

We do recommend that you continue to submit loans and get them in line with hopes that funding will come through soon.

Frank W.Hinkley

Lic. 510-LO-32270
Senior Mortgage Consultant
Guild Mortgage Company
150 120th Ave. NE Ste. 200
Bellevue, WA. 98005
Dir. 425-945-8069/ Cell. 206-979-4670
E-Fax. 425-945-8169
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