I’m a passionate proponent of homeownership. There is simply no better tool for a family to generate generational wealth than through the blessings of being a homeowner. In rural Oklahoma, I know many of our fellow neighbors struggle with the uncertainties of how to obtain that elusive first home. There is simply no better feeling knowing that you are providing a safe, and secure setting for the family and yet so many don’t know where to look or how to unlock that elusive door into homeownership.
It simply doesn’t have to be this way. Thankfully in my role as State Director, I have seen the incredible ways Rural Development has been that key for so many new homeowners in Oklahoma. USDA RD has two programs that can directly finance homeownership for our fellow Oklahomans. We also have another program where nonprofits can assist low income Oklahomans into their first home. The bottom line is there is certainly a path to home ownership, and I want to make sure we are providing our Oklahoma partners with the tools needed to unlock this elusive rural homeownership benefit.
The first program is probably our most popular USDA rural homeownership tool, and that is our Section 502 Guaranteed Loan Program, which assists approved lenders in providing low-income households the opportunity to own adequate, modest, decent dwellings as their primary residence in eligible rural areas. Eligible applicants may purchase, build, rehabilitate, improve or relocate a dwelling in an eligible rural area with 100 percent financing. The program provides a 90 percent loan note guarantee to approved lenders to reduce the risk of extending 100 percent loans to eligible rural homebuyers.
To apply for this loan, first find a financial institution that processes USDA RD loans. I have found that most local banks in Oklahoma that extend mortgages utilize USDA, but nearly any bank that does mortgages usually utilizes this service. Next, we need to determine qualifications. For RD’s purposes applicants must: Meet incomeeligibility (cannot exceed 115% of median household income);Agree to personally occupy the dwelling as their primary residence; Be a U.S. Citizen, U.S. non-citizen national or Qualified Alien; Buy in an eligible rural area.
The next program is our Section 502 Direct Loan Program. This USDA loan assists low income applicants obtain decent housing in eligible rural areas by providing payment assistance. Payment assistance reduces the mortgage payment for a short time. The amount of assistance is determined by the family income. Additional benefits of this program allow for a 33–38-year payback period, requires no down payment and has interest rates lower than commercial lender. As you can tell by these benefits this program is simply unmatched by any other homeowner program. Ultimately these loan funds, can be used to help low-income individuals or households purchase homes in rural areas. Funds can be used to purchase and prepare sites, including providing water and sewage facilities.
Applicants can determine their eligibility status by calling our State Office at 405-742-1070 and they can also utilize USDA’s Eligibility site. Because this program has complex rules, I would encourage anyone who thinks they might qualify for this or is unsure to call our Oklahoma RD Team. I have staff who are not only knowledgeable about these programs but are motivated to help their fellow Oklahomans on their journey to homeownership.
The final USDA RD program is geared towards nonprofit organizations like Habitat for Humanity. USDA recognizes that nonprofit organizations and our incredible Tribal partners are outstanding stakeholders on our goal of providing affordable and safe housing for Oklahomans. Knowing the importance these organizations play Rural Development provides Mutual Self-Help Housing Technical Assistance grants to help these organizations carry out local self-help housing construction projects. Grant recipients supervise groups low-income individuals as they construct their own homes in rural areas. The group members provide most of the construction labor with technical assistance from the organization. To see if an organization qualifies, I encourage them to call our State Office at 405-7421070.
As you can see firsttime homeownership in rural Oklahoma doesn’t have to be a mirage. I am fully committed to helping my fellow Sooners neighbors, so if you have any question about these programs or concerns anyone can reach out to me at: Kenneth.Corn@usda.gov.