Thursday, April 29, 2010

H R 5017 - USDA Guaranteed Mortgage Funding

I get so many questions about USDA Rural Development's Guaranteed Mortgage funding running out.  I pray that H. R. 5017 will pass the Senate to resolve the situation.

It is my understanding that USDA will run out of funds next week. (By May 7 th. ) Every office is working over to get as many loans obligated between now and then. It's like first come fist serve and the loans must be obligated in the order they come in. It is complicated.

Also, H.R. 5017 has passed the house and now only needs approval by the Senate. This Bill will provide 30 Billion dollars funding to the program. This is more than they can spend between now and the end of the fiscal year.

My gut opinion is that this will happen before they run out of funds. This program is a mayor boost to the housing market. Obama cannot allow the housing market to take another dive. Forclosures are still rising. This is not rocket science.

I would also like to provide my opinion on USDA staffing.  Funding commitments take 3 to 4 weeks.  This is insane!  Most offices have only two underwriters to handle this high volume, and they need at least 4 to handle the work load!  Even three underwriters would be an improvement.  There is no fundng for more personel.

Even the Direct program does not have enough personel to handle the work load.  Hello!  Think about this.  You can provide 30 Billion dollars of funding to a program but if your staff capacity can only process 10 Million, your have a problem.  Is it by Design???    Think about it!

Sorry this is so short.


  1. I believe H.R. 5017 will pass the Senate next week!

  2. I feel it will be passed also. But it needs to be passed NOW. So many home buyers will be hurt if it doesn't.

  3. H.R. 5017 Must be passed immediately. Think about the Tax Credit these people will lose.

  4. it needs to pass now so we can get our house!!!

  5. Please join the cause and make your voice heard!!/group.php?gid=123340011022487&v=wall

  6. The latest update is that USDA Guaranteed is out of funds. They will not be providing conditional commitments. The bills are back in the senate now.

    What choice do we have but to wait it out??

  7. I am waiting on this also and I heard word from my mortgage broker that there is a lender that is now funding usda loans...I have been in contact with 2 brokers in the last 2 weeks and only 1 has come to me with this. I am keeping my fingers crossed!

  8. Yesterday USDA came out with a letter stating they are issuing conditional commitments again. The bill still has not passed yet and the details are not know. Yes, lenders may choose to close the loan and receive the Loan Note Guarantee when USDA is funded. There is some risk in doing that so some lenders may choose to wait.