FLORIDA CITY, Fla., June 6, 2005 - Agriculture Secretary Mike Johanns today announced a new pilot effort by USDA Rural Development and Chase Home Finance to increase the availability of new home credit financing to provide more rural families the opportunity to achieve the dream of homeownership.

"USDA and its partners in home construction and finance have responded to President Bush's recent challenge to add seven million new affordable homes to the market in the next 10 years," said Johanns. "Through innovative partnerships, like the one announced today, more rural families will be better able to meet their housing needs and achieve the American Dream of homeownership."

Johanns' visit to south Florida highlighted President Bush's commitment to increasing homeownership and his proclamation of June as National Homeownership Month. The partnership effort announced today will spur construction of more affordable homes for low-to-moderate income families living outside major urban centers and is a result of President Bush's challenge to public and private sectors to increase homeownership opportunities for more Americans.

USDA Rural Development and Chase Home Finance officials used the homeownership month event to sign a memorandum of understanding (MOU) to formally establish the new initiative. Loan guarantees from the USDA will make it possible for Chase to offer 30 year-fixed rate construction loans that finance 100 percent of the cost of building a new home - including the lot, construction costs, closing costs and interest payments while the house is being built.

The partnership will begin with pilot programs in California, Florida, Georgia, North Carolina, Ohio and Texas, and is expected to be operational in the next 60 days. The MOU details the terms and conditions for issuing loan guarantees during the construction period and later conversion to permanent loans that will be available on USDA Rural Development's website at: http://www.rurdev.usda.gov/. Officials from the National Association of Home Builders (NAHB), which helped develop the new kind of guarantee, were on hand for the signing of the partnership.

Johanns also recognized Chase and NAHB as outstanding partners of USDA Rural Development in meeting the critical housing needs in rural America. The staff of USDA Rural Development's Centralized Servicing Center and Florida local and state offices were recognized for the service and outreach provided to those affected by hurricanes in 2004.

USDA Rural Development's mission is to deliver programs in a way that will support increasing economic opportunity and improve the quality of life of rural residents. As a venture capital entity, Rural Development has invested over $50 billion since the beginning of the Bush Administration to provide equity and technical assistance to finance and foster growth in homeownership, business development, and critical community and technology infrastructure. As a result, over 800,000 jobs have been created or saved through these investments. Further information on rural programs is available at a local USDA Rural Development office or by visiting USDA's web site at http://www.rurdev.usda.gov/.