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Government Financed And Insured Programs
There are numerous direct lending, subsidy, and mortgage insurance products available through federal, state and local agencies. Direct lending is provided through federal Rural Economic and Community Development (RECD formerly the Farmers Home Administration), state housing finance agencies, and various local governments. Mortgage insurance or loan guarantees are provided through the Federal Housing Administration (FHA), the Department of Veterans Affairs (VA), and RECD.
• FHA administers numerous mortgage insurance programs. Although there are no income restrictions, most FHA insured financing is provided to lower income, first-time homebuyers.
• VA guarantees mortgages for veterans or the armed services, those currently in the armed services and their spouses. VA guaranteed mortgage guidelines are similar to FHA except, a loan-to-value ratio of 100% is allowed.
• RECD administers several programs for low to moderate income families who want to buy new or existing homes in rural areas. The homeownership loans may be used for building, buying or improving a home.
• State housing finance agencies generally issue tax-exempt mortgage revenue bonds (MRBs) to be used for family mortgages with below market interest rates. Federal regulations outline both income and house-price maximum. Some states use part of their MRB authority to issue Mortgage Credit Certificates (MCCs). Homeowners use MCCs to lower their taxable income, thereby reducing their tax burden and increasing their disposable income.
• State and local governments offer many homeowner programs for lower income and other underserved households. Some are funded with federal funds, or state/local originated housing trust fund revenues. These programs offer local flexibility and have favorable underwriting and repayment terms. For more information please contact Prime Lend America Mortgage Corporation - Call Toll-Free: 1-877-US-PRIME
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