the arbor edge

UPDATE: 5/25 - Senate convenes today at 10:00 am for consideration of HR 4899, Emergency Supplemental Appropriations

UPDATE: 5/14 - Funds are now officially exhausted for this program and there is STILL no further guidance.  

UPDATE: 5/12 - USDA recalled their announcement to continue issuing conditional commitments in the wake of fund exhaustion.  Their bulletin states that new guidance will be issued within 24-48 hours of that date.  Back to the waiting game!


Funds for the USDA RD Guarantee program are likely exhausted today (or will be shortly).  No word on the bill in the Senate to increase funding to the program.  The good news is that on May 11, 2010, the USDA National Office released a statement authorizing the issuance of Conditional Commitments for the Single Family Guaranteed Loan Program.  The Commitments will be issued "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".

What this means is that the Rural Development offices will continue to accept applications and issue commitments.  Lenders can continue to close and fund these loans with those commitments.  RD will "obligate" funds for those loans  when they become available, as long as Congress authorizes the increase in funds and fees.

The big change here, of course, is the increase in Guarantee Fee to 3.5%.  This was certainly expected based on the bill currently in the Senate, but now we're seeing it right from the horse's mouth - RD.  Anyone who hasn't closed their RD loan yet, will be paying more for the program.  It still is a small price to pay for a 0 down payment loan program with no mortgage insurance.  

For more information on the USDA Rural Development loan program, Contact Us.