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All You Need To Understand About USDA And Know If You Are Eligible Or Not

The first is the loan guarantee, which is a mortgage issued by a local lender that allows the applicant to access a low-interest mortgage.

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Since we know the USDA loan is there to make the rural and suburban house more affordable, the program will be for individuals and families that have the greatest needs. Pixabay

If the time has come for you and your family to start looking at buying a house, you may also be looking at all the different mortgage options available. From the conventional mortgage methods through banks and lenders to home loans and VA loans, there are several options available for families to take advantage of.

One of those mortgage options is a USDA loan. Started in 2017 by the United States Department of Agriculture, the USDA Rural Development Guaranteed House Loan Program helps to make certain properties more affordable for low-to-middle income families. With all of its benefits though, it is still one of the least-known mortgage programs out there.

Before you decide on a mortgage, learn more about the USDA loan (uffexpress.com provides a thorough review of a USDA loan), and whether or not you are eligible for the assistance program.

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Consider all of your mortgage options, including a USDA loan before making your decision. You may be surprised to see what you qualify for that help make housing more affordable.
Pixabay

 

What is a USDA Loan?

Since the Department of Agriculture backs the USDA loan, you would expect that it’s for farm families only. However, that isn’t completely correct.

Although farmland and acreages would fall into the category of a USDA loan, so too would a suburban property. If you’re buying a house outside of the city, you could be eligible for this loan assistance program.

The premises of this loan is to help make properties more affordable and to improve the quality of rural America. It provides low-interest rates, as well as zero down payment option.

How Does a USDA Loan Work?

Since we know the USDA loan is there to make the rural and suburban house more affordable, the program will be for individuals and families that have the greatest needs. Some of those needs include the following:

  • The individual or family does not have a safe, decent, and clean house.
  • Their income is below the low-income limit for their living area.
  • Cannot obtain a conventional mortgage.

There are three USDA loan options available. The first is the loan guarantee, which is a mortgage issued by a local lender that allows the applicant to access a low-interest mortgage. The second is a direct loan for low and very low-income applicants. Lastly, there is the home improvement loan and grants which allow the homeowner to repair or upgrade their home.

Who is Eligible for a USDA Loan?

housing loan
The first is the loan guarantee, which is a mortgage issued by a local lender that allows the applicant to access a low-interest mortgage. Pixabay

The house location is key for getting approved for a USDA loan. Rural housing is always eligible for this loan program. You may find many eligible opportunities in suburban areas of the country. However, any metropolitan areas are likely excluded from the USDA loan program.

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Other eligibility requirements include the following:

  • The applicant must be a United States citizen or have permanent residency.
  • The potential house must be the primary residence.
  • Monthly debt payments cannot be over 41 percent of your income.
  • You must have an acceptable credit history without any collections over the past 12 months, unless you can provide proof that circumstances beyond your country (i.e. medical emergencies), affected your credit score.

Consider all of your mortgage options, including a USDA loan before making your decision. You may be surprised to see what you qualify for that help make housing more affordable.

Next Story

Ghana Preparing for it’s First Digital Population, Housing Census

The census is expected to cost $84 million, around 50% more than the last census

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Ghana, Digital Population, Census
A government official tests an electronic questionnaire in Old Fadama, Accra’s largest slum, ahead of Ghana’s first digital population and housing census in 2020, May 24, 2019. VOA

In Accra’s district of Old Fadama, the largest slum in Ghana’s capital, a government official interrupts a group of men playing cards. The official carries a tablet and asks if anyone has time for a few questions to test an electronic questionnaire.

Ghana is preparing for its first digital population and housing census next March, joining Swaziland, Malawi and Kenya as one of the first countries in Africa to collect data electronically.

Long-time resident Mohammed Basiru volunteers. He was missed out of the head count during Ghana’s previous census in 2010 because he was traveling overnight from the northern city of Tamale.

At that time, questionnaires were on paper. It took months to gather and assemble the data, and around 3% of the population was left out of the survey.

Ghana, Digital Population, Census
Satellite imagery shows the growth of Accra’s urban area between 2010 (above) and 2018 (below). The government is using satellite technology to prepare for its first digital population and housing census in 2020. VOA

Now the government will be going digital, using tablets and satellite images to improve the reach of enumerators and make sure everyone in Ghana is counted on census night.

Vice President Mahamudu Bawumia said the data would help fight inequality.

“We must count everyone and make everyone accountable to pay their fair share in taxes that would be used to target assistance to those who may not have had access to critical social services previously,” said Bawumia at an event last week.

The census is expected to cost $84 million, around 50% more than the last census. The government has contracted around 60,000 enumerators, but is still working with the United Nations on how best to source the 65,000 tablets required to conduct the surveys.

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Officials say Kenya may be able to lend out the tablets after it completes its first digital census later this year.

Araba Forson, chief statistician for the Ghana Statistical Service, said technology would prevent enumerators from under-staffing densely populated areas — a problem encountered in 2010 because the population maps they used were out of date.

“Satellite imagery will tell us that there are people living in this part of the country that the enumerator may not have visited,” she said. “Using electronic data collection, we will be able to make sure that everyone has been covered.”

Ghana’s urban population has more than doubled during the past two decades, rising from 7 million in 1997 to almost 16 million in 2017, according to the World Bank.

Ghana, Digital Population, Census
Informal settlements in Accra’s Agbogbloshie slum, where residents were evicted by city authorities to make way for a railway track in Accra, Ghana, May 26, 2019. VOA

Many people have moved from poorer rural areas in search for work, joining the millions of street vendors and waste pickers who make up most of Ghana’s informal economy.

Together with the homeless, they are the “floating population” whom government statisticians want to capture better in their database.

And the stakes are higher this time, as the census will play a key part in the nationwide rollout of biometric ID cards launched by President Nana Akufo-Addo in 2017. The new Ghana Card requires a digital address code, many of which will be generated by enumerators during the census.

In Agbogbloshie district, notorious for housing a toxic junkyard of electronic waste, community member Naa Ardo-Acquah said some slum dwellers were suspicious of the ID registration process.

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“In the Choko community, they thought the card means to tax,” she said. “The authorities didn’t sensitize them on it.”

Ardo-Acqhua hopes the new digital address system will stop city authorities from removing slum dwellers from their homes.

But distrust remains an issue, and officials testing tablets and marking houses in poorer areas said some of their numbers were later removed by informal residents who feared eviction.

“Our publicity and communication team has developed communication materials, both print and audiovisuals, that will be used to educate the people,” said Omar Seidu, a social statistician for the Ghana Statistical Service.

Ghana, Digital Population, Census
A church in Agbogbloshie slum hosts a registration center for a biometric ID card launched by Ghana’s president in 2017. VOA

Seidu said his team would be working closely with community leaders before the census to make sure the process is understood.

Ardo-Acqhua has said she still worries the government will not send enough staff to Agbogbloshie. She spent days helping people register for their ID cards at centers set up by the National Identification Authority, and said many were discouraged by long lines.

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“They only came for three days and less than half the community was able to sign up,” she said. “I don’t know what they are going to do about that.” (VOA)