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2014 in Review: New Farm Bill Allows Kansas Family to Purchase Home

Posted by Kansas Rural Development State Director Patty Clark in Rural
Feb 21, 2017
Megan Estrada and her children enjoy a swing on the porch of their new home financed by a USDA Rural Development home loan guarantee.
Megan Estrada and her children enjoy a swing on the porch of their new home financed by a USDA Rural Development home loan guarantee.

2014 will soon be in our collective rear view mirrors, and USDA Rural Development has had an incredibly productive year. This week we are looking back on stories from the year that illustrate the impact our programs have on rural communities. Here's a story out of our Kansas State Office from June.

Megan Estrada and her three children are excited to spend time on their new home’s porch – a home they just moved into this summer. Prior to purchasing their own home, Estrada and her children had spent the last nine years in an apartment in Dodge City, Kansas.

Estrada tried to buy a home four years ago, but with no solid credit history was unable to secure a loan through conventional home financing. For the next four years Estrada built up her credit, then in May of this year she heard that USDA would be offering home loans in Dodge City and called her banker to see how to apply.

With the passage of the 2014 Farm Bill, Dodge City became eligible for USDA Housing Programs. The Farm Bill contained language that changed the definition of a rural area for USDA’s Housing Program; the new definition allowed areas with populations of up to 35,000 that are rural in character to be eligible for USDA Housing Programs – which made Dodge City eligible.

In June, Estrada was the first Dodge City resident to purchase a home by utilizing USDA’s Guaranteed Rural Housing Program. Landmark National Bank provided the loan on Estrada’s three-bedroom home, which is guaranteed by USDA Rural Development.

“I am prepared to accept the responsibility of homeownership, and am looking forward to it,” said Estrada. “The kids enjoy having a backyard to play in, and I like allowing them to play outside where I know they are safe.”

Since 2009, USDA Rural Development has helped more than 11,000 Kansas residents purchase a home.

As the new year begins, we in Rural Development look forward to a productive 2015 and the continued opportunity to promote, develop, and support the way of life in the rural communities that support agriculture across our nation.

Category/Topic: Rural

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Comments

Patty
Dec 30, 2014

congratulations to you. i too enjoy my USDA-RD home. Our tax dollars at work!

Sully
Jan 03, 2015

guaranteed by USDA Rural Development if the loan is not paid then tax dollars will be used right ?

Ben Weaver
Jan 05, 2015

@Sully - thanks for your comment. The short answer is yes, but the longer answer is a bit more complicated. The Rural Development Guaranteed Rural Housing program is self-funded through origination fees paid by the lenders and borrowers who use the guarantee. This makes the program budget-neutral, thus requiring no additional dollars from the treasury to cover the obligations. So, any defaults are covered by the fees collected from originating the guarantees.

Eme
Feb 03, 2015

Congratulations! My family are in the first process of finding a lender that participates with this program in my hometown in Hawaii. Wish us luck!

Deborah L
Feb 20, 2015

I've been following the USDA Rural Development Housing loans and its requirements for quite some time. Over the past 5 years I've maintained an average credit score of 745. Recently, after over 10 years of not missing a single account payment, I missed ONE payment (just forgot about it) and it caused my credit score to drop dramatically (673). I have filed for debt forgiveness for my student loans. Would the one late payment and debt forgiveness affect my approval/qualifications for Direct or Guarantee housing loan? The mobile home I currently live in is being condemned and I act on something quickly.