>La Grande Observer | Union and Wallowa Counties' News Leader

Bill Rautenstrauch

The Observer

Availability of U.S. Department of Agriculture funds — plus an increase in loan limits — may help some Northeast Oregonians along the road to home ownership in the coming year.

The Rural Housing Service of the USDA's Rural Development Program currently has more than $7.25 million available for rural homebuyers in Oregon.

About $5.1 million of the money is for mortgage loan guarantees, and another $2 million is for direct mortgage loans to help finance homes for qualified rural homebuyers.

Patricia Good, a USDA Rural Development manager based in Pendleton, said the $5.1 million mentioned in a recent USDA press release is available this quarter alone.

She said more money for loan guarantees comes available quarterly.

"These aren't all the funds," she said. "We wrote $14 million in those loan guarantees last year."

Good's office in Pendleton covers Baker, Gilliam, Grant, Malheur, Morrow, Umatilla, Union, and Wallowa counties.

People obviously are taking advantage of the available programs.

Good said that between October 2004 and September 2005, the regional office wrote 36 loan guarantees in Union County, 13 in Baker County and four in Wallowa County.

She said eligibility for the guarantees depends on what portion of an applicant's income goes to pay off debt.

"It boils down to the ratio between what they will be paying on the loan, and total debt," she said.

Credit history also is a factor.

Generally, the cost of the loan may not exceed 29 percent of income, and all debt may not exceed 41 percent.

Local lenders working with the program are plentiful and include FirstBank, Wells Fargo, Allied Mortgage and Premier Mortgage.

"Those are ones we deal with frequently, but there are others," Good said.

Periodically, the USDA increases loan guarantee limits county-by- county to keep pace with inflation and market situations.

Earlier this month, the department announced new loan guarantee limits of $172,600 for Union and Wallowa Counties and $161,000 for Baker Counties.

In addition to the loan guarantee program, the Rural Housing Service also has about $2 million available for direct loans to rural buyers with low and very low incomes.

Loans made under the 502 Rural Housing Direct Subsidized Loan Program are to families with incomes below 80 percent of the median level.

In Union County, for one person income would have to be below $27,050. For two people the threshold is $30,900, for three $34,800, and for four $38,650.

The USDA also has limited loans and grants available for very low income families to repair their homes.

Under the 504 Home Repair and Grant Program, loans and grants are provided for renovation aimed at removing health and safety hazards, and to make a home accessible for people with disabilities.

Homeowners 62 years and older are eligible for home improvement grants. Other low-income families and individuals receive loans at a 1 percent interest rate directly from the program.

For more information, contact the Pendleton USDA Rural Development Office, 541-278-8049.