Low-interest rates available for USDA Rural Development home mortgage loans

LINCOLN, Neb. – The U.S. Department of Agriculture Rural Development has announced a decrease in the home mortgage interest rate for its Section 502 Homeownership Direct Loan program. Effective March 1, the interest rate was reduced to 3 percent for home mortgages.

This is the lowest interest rate in two years offered by the agency.

Homeownership opportunities are available under this program with no down payment, and provide for long term, fixed interest rate financing. Applicants must have acceptable credit history and repayment ability. Credit scores of 640 or greater are typically considered as acceptable, however, credit scores below 640 may also be considered if there are mitigating circumstances.

The low interest rate may make it a good time for eligible families to purchase a home through the USDA Rural Development direct loan program. Depending on household incomes, mortgage payments may be further subsidized to as low as one percent interest rate. The Section 502 direct loan program is available to households with incomes at 80 percent or less of the county median income, for the purchase of an existing home or for new construction in rural areas.

All communities in Nebraska are eligible for housing programs with the exceptions of Fremont, Grand Island, Hastings, Kearney, Lincoln, North Platte, Omaha and South Sioux City/Dakota City. Visit http://www.rd.usda.gov/ne for more information.