Rural Home Loans (Direct Program) What does this program do? Also known as the Section 502 Direct Loan Program, this program assists low- and very-low-income applicants obtain decent, safe and sanitary housing in eligible rural areas by providing payment assistance to increase an applicant’s repayment ability. Payment assistance is a type of subsidy that reduces the mortgage payment for a short time. The amount of assistance is determined by the adjusted family income. Who may apply for this program? A number of factors are considered when determining an applicant’s eligibility for Single Family Direct Home Loans. At a minimum, applicants interested in obtaining a direct loan must have an adjusted income that is at or below the applicable low-income limit for the area where they wish to buy a house and they must demonstrate a willingness and ability to repay debt. Applicants must: • Be without decent, safe and sanitary housing • Have the legal capacity to incur a loan obligation • Be unable to obtain a loan from other resources on terms and • Meet citizenship or eligible noncitizen requirements conditions that can reasonably be expected to meet • Not be suspended or debarred from participation • Agree to occupy the property as your primary residence in federal programs Properties financed with direct loan funds must: • Be modest in size for the area • Not have in-ground swimming pools • Not have market value in excess of the applicable area loan limit • Not be designed for income producing activities Borrowers are required to repay all or a portion of the payment subsidy received over the life of the loan when the title to the property transfers or the borrower is no longer living in the dwelling. Applicants must meet income eligibility for a direct loan. Please contact your local RD office to ask for additional details about eligibility requirements. What is an eligible area? How much may I borrow? Generally, rural areas with a population less than 35,000 are The maximum loan amount an applicant may qualify for eligible. Visit the USDA Income and Property eligibility will depend on the applicant’s repayment ability. The website for complete details. applicant’s ability to repay a loan considers various factors such as income, debts, assets and the amount of payment How may funds be used? assistance applicants may be eligible to receive. Regardless of repayment ability, applicants may never borrow more Loan funds may be used to help low-income individuals than the area’s loan limit (plus certain costs allowed to be or households purchase homes in rural areas. Funds can financed) for the county in which the property is located. be used to build, repair, renovate or relocate a home, or to purchase and prepare sites, including providing water and sewage facilities. Rural Home Loans (Direct Program) What is the interest rate and Is there a deadline to apply? payback period? Applications for this program are accepted through • Fixed interest rate based on current market rates at loan your local RD office year round. approval or loan closing, whichever is lower. • The monthly mortgage payment, when modified How long does an application take? by payment assistance, may be reduced to as little Processing times vary depending on funding availability as an effective 1% interest rate. and program demand in the area in which an applicant is • Up to 33 year payback period - 38 year payback period interested in buying and completeness of the for qualifying applicants who can’t afford the 33 year application package. loan term. How much down payment is required? What law governs this program? No down payment is typically required. Applicants with • The Housing Act of 1949 as amended, 7 CFR, Part 3550 assets higher than the asset limits may be required to • HB-1-3550 - Direct Single Family Housing Loans Field use a portion of those assets. Office Handbook NOTE: Because citations and other information may be subject to change please always consult the program instructions listed in the section above titled “What Law Governs this Program?” You may Add contact information also contact your local office for assistance. You will find additional forms, resources, and program information at www.rd.usda.gov. USDA is an equal opportunity provider, employer, and lender. Last Updated August 2019 Wisconsin Direct INCOME LIMITS County 1-4 Person Household 5-8 Person Household Brown $65,450 $86,400 Calumet $67,050 $88,500 Chippewa $58,650 $77,400 Columbia $62,650 $82,700 Dane $75,500 $99,650 Dodge $59,750 $78,850 Door $57,300 $75,650 Douglas $57,900 $76,450 Dunn $55,300 $73,000 Eau Claire $58,650 $77,400 Fond du Lac $60,250 $79,550 Green $61,500 $81,200 Iowa $59,700 $78,800 Jefferson $61,850 $81,650 Kenosha $65,300 $86,200 Kewaunee $65,450 $86,400 La Crosse $62,900 $83,050 Marathon $58,550 $77,300 Manitowoc $55,100 $72,750 Monroe $55,350 $73,050 Oconto $55,350 $73,050 Outagamie $67,050 $88,500 Ozaukee $65,850 $86,900 Pepin $55,700 $73,500 Pierce $75,500 $99,650 Portage $61,300 $80,900 Racine $60,000 $79,200 Rock $54,700 $72,200 Sauk $56,400 $74,450 Sheboygan $61,500 $81,200 Trempealeau $56,250 $74,250 St. Croix $75,500 $99,650 Walworth $62,650 $82,700 Washington $65,850 $86,900 Waupaca $54,800 $72,350 Waukesha $65,850 $86,900 Wood $56,500 $74,600 Winnebago $62,550 82,550 All Other Counties* $54,700 $72,200 *Milwaukee County Is Ineligible For Rural Development Homeownership Programs Rural Development • Wisconsin State Office 5417 Clem’s Way • Stevens Point, WI 54482 • (715) 345-7611 • [email protected] 07/22/2019 USDA is an equal opportunity provider, employer, and lender. Single Family Home Loan Guarantees What does this program do? This program assists approved lenders in providing low- and moderate-income households the opportunity to own adequate, modest, decent, safe and sanitary dwellings as their primary residence in eligible rural areas. Eligible applicants may build, rehabilitate, improve or relocate a dwelling in an eligible rural area. The program provides a 90% loan note guarantee to approved lenders in order to reduce the risk of extending 100% loans to eligible rural homebuyers. Who may apply for this program? Applicants must: • Meet income-eligibility. • Have not been suspended or debarred from participation • Agree to personally occupy the dwelling in federal programs. as their primary residence. • Demonstrate the willingness to meet credit obligations • Be a U.S. Citizen, U.S. non-citizen national or Qualified Alien. in a timely manner. • Have the legal capacity to incur the loan obligation. • Purchase a property that meets all program criteria. What is an eligible area? • A pro rata share of real estate taxes that is due and payable Check eligible addresses for the loan guarantees. on the property at the time of loan closing. Funds can be allowed for the establishment of escrow accounts for real estate taxes and/or hazard and flood insurance premiums. How may funds be used? • Essential household equipment such as wall-to-wall Funds backed by loan guarantees be used for: carpeting, ovens, ranges, refrigerators, washers, dryers, • New or existing residential property to be used as a heating and cooling equipment as long as the equipment permanent residence. Closing cost and reasonable/ is conveyed with the dwelling. customary expenses associated with the purchase may • Purchasing and installing measures to promote energy be included in the transaction. efficiency (e.g. insulation, double-paned glass and solar panels.) • A site with a new or existing dwelling. • Installing fixed broadband service to the household as • Repairs and rehabilitation when associated with the long as the equipment is conveyed with the dwelling. purchase of an existing dwelling. • Site preparation costs, including grading, foundation • Refinancing of eligible loans. plantings, seeding or sod installation, trees, walks, fences and driveways. • Special design features or permanently installed equipment to accommodate a household member who has a physical disability. How do we get started? • Reasonable and customary connection fees, assessments Applicants must contact an approved lender. Information or the pro rata installment cost for utilities such as water, about approved lenders may also be obtained by sewer, electricity and gas for which the buyer is liable. contacting a Guaranteed Loan Coordinator in your state for more information. Single Family Home Loan Guarantees Who can answer questions? Why does USDA Rural Development Applicants with questions should contact an approved do this? lender. Lenders with questions can contact a Guaranteed This program helps lenders work with low and Loan Specialist in your state. moderate income families living in rural areas to make homeownership a reality. Providing affordable What governs this program? homeownership opportunities promotes prosperity, which in turn creates thriving communities and improves the 7 CFR, Part 3555 quality of life in rural areas. NOTE: Because citations and other information may be subject to change please always consult the program instructions listed in the section above titled “What Law Governs this Program?” You may Add contact information also contact your local office for assistance. You will find additional forms, resources, and program information at www.rd.usda.gov. USDA is an equal opportunity provider, employer, and lender. Last Updated February 2015 Wisconsin GRH INCOME LIMITS County 1‐4 Person Household 5‐8 Person Household Brown $94,100 $124,200 Calumet $96,400 $127,250 Chippewa $86,850 $114,650 Columbia $90,050 $118,850 Dane $108,550 $143,300 Douglas $92,600 $122,250 Eau Claire $86,850 $114,650 Fond du Lac $86,850 $114,650 Green $88,400 $116,700 Jefferson $88,900 $117,350 Kenosha $93,850 $123,900 Kewaunee $94,100 $124,200 La Crosse $90,400 $119,350 Marathon $86,850 $114,650 Outagamie $96,400 $127,250 Ozaukee $94,650 $124,950 Pierce $108,550 $143,300 Portage $88,100 $116,300 Racine $86,850 $114,650 Sheboygan $88,400 $116,700 St.