May 31, 2010
Nation's Building News

The Official Online Newspaper of NAHB

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Politics and Government
Rural Housing Program Funding Moves Forward in Congress

With funding for a key rural housing program exhausted, Congress last week moved legislation forward to ensure that home buyers in rural areas have continued access to affordable mortgages through the U.S. Department of Agriculture (USDA) 502 loan guarantee program.

With NAHB’s full support, the House passed H.R. 5017, the Rural Housing Preservation and Stabilization Act of 2010, sponsored by Reps. Paul Kanjorski (D-Pa.) and Shelley Moore Capito (R-W.V.). The legislation would give the USDA the authority to increase the upfront premium for 502 guarantees, making the program self-sustaining and providing families in rural communities with a vital source of mortgage credit.

Companion legislation was then introduced in the Senate by Sen. Michael Bennet (D-Colo.), with similar provisions subsequently included in the Senate-passed Emergency Supplemental Appropriations bill, H.R. 4899. While H.R. 4899 passed the full Senate last week, the House will not take action on the legislation until it returns from its Memorial Day recess on June 7, leaving the 502 program without much-needed funding.

At the urging of key members of Congress, the USDA issued guidance last week indicating that it has authorized the issuance of conditional commitments for the Section 502 Single Family Housing Guaranteed Loan Program beginning immediately and continuing until $2.5 billion in total loan guarantees are exhausted.

The plan is to allow these commitments to bridge the gap until Congress finalizes the legislative fixes needed to put the program back on a solid financial footing. NAHB will continue to advocate on behalf of this important rural housing program until this critical funding situation is addressed.

To read legislatiion, click here and enter the bill number in the upper center of the page.

For more information, e-mail Scott Meyer at NAHB, or call him at 800-368-5242 x8144.

 

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