Yesterday, the U.S. House of Representatives passed the Rural Housing Preservation and Stabilization Act of 2010 (H.R. 5017). Through this legislation, the guarantee fee in the USDA Guaranteed Rural Housing (GRH) Program may be raised to offset any need for Congressional appropriations. Additionally, H.R. 5017 would authorize USDA Rural Development to guarantee up to $30 billion in loans in Fiscal Year 2010. This would represent an additional $18 billion in loan making authority for the remainder of this fiscal year.

Before these changes can be implemented, similar legislative action will need to occur in the U.S. Senate.

Following this action in the House, the USDA Rural Development National Office sent an announcement that stated: “Depending upon Congressional activity with the proposed legislation it is possible that the Agency may consider issuing Conditional Commitments.”

The purpose of this update is to keep your organization apprised of the actions being taken to address the pending lack of funding for the USDA GRH Program. Please share this information with your loan origination and processing staff, as well as with Realtors and builders. We will continue to keep you updated regarding available program funding, in addition to any legislative events pertaining to the USDA GRH Program.

As always, we at Chase remain committed to the USDA Guaranteed Rural Housing Program and appreciate your support of the home financing needs of rural America. If you have questions or need additional assistance, please feel free to contact your Chase Rural Housing Account Executive.