Rural Development to the rescue!

Been trying to figure out how to take advantage of the tax credit for new home buyers but having trouble coming up with the down payment?  A Rural Development loan may be your answer.  The USDA/RD describes RD loans this way,

"Section 502 loans are primarily used to help low-income individuals or households purchase homes in rural areas. Funds can be used to build, repair, renovate or relocate a home, or to purchase and prepare sites, including providing water and sewage facilities."

Here are some of the details that you will need to know about RD loans (also known as Section 502 loans).  First, there is no down payment required with an RD loan.  However, there are income restrictions based upon the area where you wish to live.  You can see those income limits for Arkansas here.  You must also have a "reasonable" credit history.

Second, your lender must be approved by the USDA to process RD loans.

The following is taken from the USDA website:
    Approved lenders under the Single Family Housing Guaranteed Loan program include:

• Any State housing agency
• Lenders approved by:
• HUD for submission of applications for Federal Housing Mortgage Insurance or as an issuer of Ginnie Mae mortgage backed securities
• the U.S. Veterans Administration as a qualified mortgagee
• Fannie Mae for participation in family mortgage loans
• Freddie Mac for participation in family mortgage loans
• Any FCS (Farm Credit System) institution with direct lending authority 
• Any lender participating in other USDA Rural Development and/or Farm Service Agency guaranteed loan programs.

In addition, there are restrictions on the property you buy.  Here is a quote from the USDA website regarding approved properties:

"Under the Section 502 program, housing must be modest in size, design, and cost. Houses constructed, purchased, or rehabilitated must meet the voluntary national model building code adopted by the state and HCFP thermal and site standards. New Manufactured housing must be permanently installed and meet the HUD Manufactured Housing Construction and Safety Standards and HCFP thermal and site standards. Existing manufactured housing will not be guaranteed unless it is already financed with an HCFP direct or guaranteed loan or it is Real Estate Owned (REO) formerly secured by an HCFP direct or guaranteed loan."

For more information on RD loans or to view properties that may qualify for this type of loan, give me a call at 501.514.2319 or send email to Rodney@RodneyGetsResults.com