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If you are considering the purchase of a home in a rural area using the USDA Guaranteed Rural Housing mortgage program, you might want to get your plans in gear. The Rural Development national office in Washington, D.C., recently issued a letter to participating lenders stating that funding for the Guaranteed Rural Housing program would most likely be exhausted by the end of April 2010.

The Guaranteed Rural Housing Program provides 100% mortgage financing to home buyers purchasing homes in designated rural areas. The design of this program is to spur growth and housing in rural parts of the United States. Much of Texas falls under this program, including parts of Montgomery, Fort Bend, Brazoria, Liberty, and Waller counties. 

The program is likely to be continued, but it is unclear when funding will be provided. The last thing the government needs is another obstacle to recovering housing markets. In the interim, borrowers will likely have to consider other financing options which may not be as flexible. Most will likely choose to utilize FHA loans which require a 3.5% down payment.

Stay Tuned!