Jeanean Gendron, Your Shasta County Real Estate Specialist: USDA Funding Update - H.R 4899 Has Been Signed Into Law

Early last week, the House of Representatives passed an emergency supplemental appropriations bill.  That bill includes a provision to both reform and restart the USDA (Rural Housing Service) single-family guarantee program. 

President Obama signed the measure H.R. 4899 on July 29th making it law.  The presidential signing was expected to happen without any resistance.  This measure covers a variety of topics, including $34.7 billion in funding for the wars in Iraq and Afghanistan.  There are provisions for other international and domestic government programs as well.  The Gulf oil spill received $275 million in funding.

Specifically, the RHS provision gives the Agriculture Secretary the authority to increase the upfront premium on all RHS backed loans.  The maximum approved upfront premium increase can be as much as much as 3.5%.  This is up from the current upfront premium of 2%.  This increase will enable USDA to cover the cost of the new loan guarantees being issued.  The additional funding will also make program self-funding. 

The USDA secretary also has been given the option of charging a 0.5% annual premium, similar to that of FHA.  Currently, USDA does not charge an annual premium. 

It is always advisable to consult with a Certified Mortgage Planning Specialist (CMPS) when navigating today's turbulent mortgage and real estate marketplace. As a CMPS professional, I am committed, qualified and equipped to help you evaluate your options!

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Rodney Mason is a Certified Mortgage Planning Specialist located in Atlanta, GA.  He is also 203K Renovation Loan and REO Property Specialist.  He can be reached at (404) 591-2453.

           

NMLS #151088 - Licensed in AL & GA.