Archive for USDA
Income Limits Updated for USDA
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USDA has announced the income limits for Section 502 Guaranteed Rural Housing Program have changed, effective June 2, 2010. The new income limits can be found at the USDA Rural Development Eligibility Home page by following either of the links provided below.
http://eligibility.sc.egov.usda.gov
(click on “Guaranteed Housing” under the “Income limits” tab on the left side of the page)
or
http://www.rurdev.usda.gov/rhs/sfh/sfh%20guaranteed%20loan%20income%20limits.htm
(Direct link to the 2010 Income Limits)
The number of people used for income eligibility is the number of people living in the home, including foster adults and foster children, not the number of applicants on the file.
The basic income limit for non-high cost counties are:
| 1-4 Person |
5-8 Person |
$74,050 |
$97,750 |
So, regardless of whether you are purchasing a home in a high-cost area or a non-high cost area the benefit is that if you only have 1 – 2 people in your household you get the benefit of a 4 person household, and if you have 5 people in your household you get the benefit of an 8 person household.
Don’t assume just because you income is over the income limit that you don’t qualify. USDA allows for deductions to income, these are only for income limit qualifying not debt ratio qualifications; so, you still get the benefit of your full income. Each household member under 18 Years old, Disabled, or Full Time Student receives a $480 deduction to your annual income. There is also an allowance for documented child care expenses.
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Private Well and USDA Home Loan
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Water Quality Requirements
A USDA Home Loan requires that all private wells must meet local and State requirements. A USDA Home Loan requires the property to have safe and adequate water. The water system must be approved by a State or Local Government agency. When the property has a private well system then it must meet the requirements of the State Department of Health. Written verification must be obtained showing the water complies with the Safe Drinking Water Act and the Clean Water Act.
The present requirements for Safe Drinking Water needed for a USDA Loan:
* only one test needs to be performed for nitrates; however, a laboratory can report the results of its nitrate testing in either of the ways listed.
Testing of Well Water
It is a good practice to test your well water each year. A basic test will let you know if a problem exists. Testing more than once a year may be warranted if:
- Someone in the house is pregnant or nursing
- A neighbor finds contaminants in their well water
- Unexplained illness in the family
- You notice a change in water taste, color, or clarity
- You replace or repair any part of the well system
Most County Health Departments will do a test for your personal use free of charge. There is a slight charge for a well test for mortgage purposes. Before taking a water sample, contact the lab for any special instructions.
Maintaining an Existing Well
Good well maintenance means testing your well water approximately once a year. You should keep the well area clean and accessible, keep all pollutants as far away as possible, and have a licensed well driller check the well if problems are suspected. If you house has a septic as well, you need to keep it in good operating condition to keep the septic from possibly contaminating the well water.
Preventing Backflow
You should install anti-backflow devices on all your faucets with hose connections in and outside your home. Otherwise, contaminated water from a laundry tub, sink, washing machine, or pressure washer could flow back through the plumbing to contaminate your drinking water supply.
Disinfecting the Well
For every 100 gallons of water in the well, use 3 cups of liquid laundry bleach. Mix the bleach with approximately 10 gallons of water. Turn off the pump circuit breaker before removing the well cap. Pour the solution into the well. If you have a water softener this is a good time to disinfect it as well. Turn on the pump. Connect a clean garden hose and run water for about 10 minutes. Turn off the pump, put the hose into the top of the well casing, turn on the pump, re-circulate water for about 2 hours. Then open up all other water faucets in the house (faucet aerators may need to be removed to keep from clogging), until you smell chlorine, then close then shut them off. After 24 hours open all the faucets again and continue to run until you no longer smell chlorine and taste disappears.
For more information on your drinking water:
The following sites provide information on steps you can take as a private well owner:
New Hope for Housing: HAMP 2.0
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Obama announces changes to to HAMP
While this modification sounds great each of these programs to help, has garnered little support, and been able to help very few people. The reason that each program has failed is because the guidelines for the customer to qualify are still too stringent.
The program has been modified to attempt to help those that have been effected by the economy through no fault of there own. There is increased incentives for mortgage services to help unemployed homeowners, and for those that owe more than their home is worth. This is still in an effort to help stabilize the housing market.
Eligible homeowners must live in an owner-occupied home, have a mortgage balance less than $729,750, owe monthly mortgage payments that are not affordable (greater than 31% of gross income), and demonstrate some sort of financial hardship.
Today is an important step forward for homeowners, who will now have more options to retain homeownership. The use of principal write down as an additional tool in the Home Affordable Modification Program (HAMP) will offer expanded opportunities in the case of negative equity.
Faith Schwartz
Executive Director
Hope NOW
For more information on HAMP 2.0:
FHA Refinance Fact Sheet for Underwater Homeowners
Here is a video from CNBC that goes over the new developments for HAMP:
If you cannot view the above video on HAMP Updates Click Here.
USDA still needs additional funding for the Guaranteed Rural Housing Program
One item that was completely ignored was increased funding for a program that is already working, USDA Home Loans. A USDA Home Loan is one of the best loans available, it also has the lowest foreclosure rate of any other product available, 1.72%. The Wall Street Journal had an excellent piece talking about USDA Home Loan and the need for Congress to authorize additional funding.
I urge everyone to contact your elected officials immediately and voice your concerns; Authorize additional funds for USDA Home Loans.
16 Signs of Mold
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There are 16 signs that you need mold testing in your home. Mold that produces and releases dangerous toxins into the air can affect a family’s health. Many times we see only one family member affected. There are many things to look for if someone in your home is being affected by these toxins.
Why is Mold Testing Necessary?
Testing for mold is important because mold spores can cause or aggravate many illnesses, including asthma and allergies. Some molds can cause very serious lung infections.
When should Testing Take Place?
Mold testing should be done if anyone in the household is feeling effects associated with fungal contamination. Symptoms include headaches, dizziness, difficulty paying attention, and lack of concentration.
What should I Look for?
The following are signs that mold could be growing in your home and needs to be eradicated:
- High humidity – areas that are prone to high levels of humidity retain moisture for longer amounts of time, fostering mold growth.
- Pipe or water leaks – surfaces that are consistently wet provide a home for mold, and leaks can be difficult to detect
- Flooding – large scale water damage to a home is very conducive to mold growth
- Musty, moldy odors – odors are a good indication that mold is present
- Increased respiratory problems or allergies – a Mayo Clinic study, completed in 1999, found that most chronic sinus problems were caused by mold in the home
- Symptoms of toxic poisoning – signs that family members are being affected include dizziness, headaches, and difficulty concentrating and maintaining an attention span
- Leaky Roof – the attic will show signs of water damage
- Damp basement or crawlspace – moisture in dark environments encourages mold growth
- Rusting or condensation – can be signs of a leak
- Discoloration or water stains on walls – water stains will indicate locations of leaks, while discolored spots may indicate locations of mold
- Peeling paint – the mold could have had a chance to grow before the wall was painted, causing the current peeling
- Warped wood – this is a sign that moisture is present in sufficient levels to allow mold to grow
- Growth of mold in bathroom tile areas – this is a very good indication that mold is growing in other areas of the house
- Visible mold growth – indicates a strong presence of mold elsewhere in the house
- Poor ventilation – if moisture from the home, including appliances, isn’t vented, it can facilitate mold growth
- Wet materials inside the house – any areas of carpet or flooring that are wet frequently can also house mold.
While being unsightly and sometimes difficult to clean, mold should be removed from the home. It causes damage to the home itself, but the most intense effects are upon humans. Breathing mold spores can be very dangerous, especially for the very young or those who are advanced in years or adults with compromised immune systems. If you locate any of these signs in your home, it’s time to conduct testing for mold to see how extensive the problem has grown.
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The Ides of March: USDA Just About Out of Funds
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USDA has Almost Exhausted Funds for the Year
In Indiana a USDA Home Loan is the best loan available, allowing buyers to purchase a home with no down payment, and no monthly mortgage insurance. A USDA Home Loan is such a popular loan that it has been running out of funds quicker, and quicker each year. Each year, new funds are appropriated to allow the USDA Home Loan program to continue to operate. This year is no different.
USDA sent out an announcement on March 10, 2010:
Notice of Funding
This message is to notify you that program funding for the Single Family Housing Guaranteed Loan Program will likely be exhausted by the end of April, 2010.
Once funding is exhausted, the Agency will not issue Conditional Commitments “subject to receipt of appropriated funds.” This is because it is not certain when additional funding will be available.
Limited funding may become available for disaster areas declared in 2008, or in disaster areas declared for Hurricanes Katrina and Rita. Limited funding may also become available as prior Agency commitments are de-obligated, however, such funding will be very limited.
We apologize for any inconvenience this may cause you. Should you have any questions, you may contact the Single Family Housing Guaranteed Loan Division at (202)720-1452.
So, what does this mean
First, in years past when similar announcements were delivered, USDA will NOT issue conditional commitments for loans, as the program awaits new appropriations from Washington. This means that lenders will not continue to close USDA Home loans in anticipation of new appropriations.
This could potentially mean that the USDA Home Loan Program will not get new funds until after it’s 2010 Fiscal Year End, September 30, and then not have funds available until November or even December. Because of how weak the housing market and economy is, this scenario is very unlikely, and since a large portion of the USDA Home loans are utilized by first time home buyers. The first time home buyer market is a portion of the economy that the government is trying desperately to help.
If you do not presently have an accepted purchase offer, or are attempting to purchase a short sale, you must get the offer accepted quickly to get your loan closed and funded before funds run out. I would expect funds to be depleted by the middle of April. If you are unable to get closed in time you will need to put down 3.5% for an FHA loan, or 5% for a conventional loan.
What can you do
Contact your members of Congress regarding this funding crisis and reiterate the negative impact to low-and-moderate income rural families and to rural communities (Basically ALL of Indiana). Let them know that we need funds to get the housing market back on track. The Department of Agriculture is obviously attempting to get additional funding, and pursing changes to the program that could help or possibly completely eliminate future funding problems, but they need our help. Your elected officials contact information.
Available Funding:
Fiscal Yr 2010 Congressional Appropriated Funds: $13.5 Billion
Fiscal Yr 2010 USDA Rural Obligations: $9.7 Billion (as of 3/22/10)
Available Funds: $3.8 Billion
Basically, in half of the USDA fiscal year they have depleted their entire funds for the year
I will update you as more information comes available.
