The Daily Yonder – Rural Mortgage Activity Declines

by Keith Wiley, Research Associate at the Housing Assistance Council

Rural mortgage markets continue to struggle in the aftermath of the national housing crisis.

The number of home loans in rural areas declined by 14.1% between 2012 and 2013, according to the most recent Home Mortgage Disclosure Act (HMDA) data. The drop-off in lending is largely related to refinance activity. Gradually increasing interest rates and tighter underwriting criteria have slowed mortgage refinancing nationally, as well as in rural communities. Refinance lending in rural and small town communities declined by 23% in 2013 from 2012 levels.

Rural home purchase lending, on the other hand, increased by 2.3% from 2012. After reaching a 10-year low in 2011, rural home purchase loans increased for the past two years to 440,489 in 2013.

While these trends suggest an improvement in home sales, rural and small town home purchase loans remain 52% below the pre-recession levels of 2006. Home purchase loans continue to make up a smaller portion (35%) compared to refinance loans (57%) of all rural lending activity.

Read the full story at The Daily Yonder

Changes in Rural Housing Eligibility Definition Delayed by Continuing Resolution

September 25, 2014 – USDA Rural Development says that the continuing resolution (CR) to extend FY14 funding levels through December 11 also extends a provision related to the definition of rural used for the USDA rural housing programs. The FY14 appropriations law prohibited declaring any communities ineligible for the rural housing programs if they were eligible on September 30, 2013. President Obama signed the continuing resolution into law on September 19. As its name implies, the CR continues provisions of the FY14 law, including the prohibition on making places ineligible.

If a new FY15 appropriations law had been enacted, communities could have been determined ineligible based on population – if their populations grew to over 35,000 – or based on no longer being considered “rural in character.” USDA recently suspended all “rural in character” changes until at least September 30, 2015, so the CR’s suspension of ineligibility applies only to places with populations over 35,000. It will last until Congress enacts, and the President signs, an FY15 USDA appropriations law. It is possible that additional CRs will be adopted beyond December 11, maybe even for all of fiscal year 2015 (through September 30, 2015).

Second round of Promise Zone Competition announced

The Obama Administration invites a new round of eligible applicants to apply for a Promise Zone designation. HUD will designate six urban communities and USDA at least one rural and one tribal community as Promise Zones. This initiative targets high-poverty communities for job creation, economic development, and additional special assistance in an effort to drastically improve conditions for communities suffering persistent poverty. Applications are due November 21, 2014 by 5:00 PM EST.

Audience Focused Webcasts

To assist communities with the application process, HUD and USDA are hosting three Promise Zone Initiative Webcasts:

Tribal Webcast
September 29, 2014, Monday
1:00-2:00p.m. EST (please adjust for your local time)

Rural Webcast
September 29, 2014, Monday
3:00-4:00 p.m. EST (please adjust for your local time)

Urban Webcast
October 1, 2014, Wednesday
3:00-4:00 p.m. EST (please adjust for your local time)

More information

John Henneberger named a 2014 MacArthur Fellow

HAC would like to congratulate John Henneberger of Texas Low Income Housing Information Service on his selection as a 2014 MacArthur Fellow. John received the honor in in recognition of his innovation with regard to post-disaster recovery.

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NPR explores homeless veteran populations

While there are now fewer homeless veterans than in the past, there are growing number of homeless veterans with families, including many women. NPR examines the unique needs of these populations.

Preserving rural rental housing – Elkton MD Case Study

A partnership between two owners or adjacent rental properties serving seniors, persons with disabilities and families in Elkton, Maryland (pop. 15,718) showcases creative approaches to preserving and rehabilitation of affordable rural housing.

Learn more about the HAC loan fund

The HAC loan fund is hosting two upcoming webinars that will provide an overview of its products and help organizations in rural areas better understand how to access and creative utilize capital from HAC.

Understanding HAC Loan Products: An Overview on Uses, Eligibility Requirements and Restrictions

Register Now!

Making it Work: Creative Ways to Utilize HAC Loan Products in Your Affordable Housing Development

Register Now!

The HAC loan fund lends only to organizations that develop housing in rural areas and does not offer programs accesible for individuals looking for housing. If you are looking for housing for yourself, visit our “Looking for Housing” page.

HAC Recommends Notifying Tenants about Maturing Mortgages

On August 7, 2014, HAC wrote a letter to Tony Hernandez, USDA’s rural housing programs administrator, to express concern about tenants in properties that will lose USDA Section 521 Rental Assistance when their USDA mortgages mature. Over 8,000 properties with Section 515 or Section 514 mortgages are expected to make their last payments to USDA by the year 2020. Because many of the tenants rely on USDA Section 521 Rental Assistance, which is available only when a USDA mortgage is in place, thousands of tenants in those 8,000 properties risk losing their aid when these mortgages mature.

HAC’s letter to Hernandez encourages USDA to follow HUD’s practice and ask property owners to notify tenants at least nine months before their Rental Assistance ends. The letter also asks for a dialogue between HAC, USDA, and other interested parties to identify approaches to keeping the housing affordable.

Is the Housing Crisis Over in Rural America?

by Lance George

In 2008 the U.S. economy fell off a cliff. Depending on your perspective it either slipped or was pushed from that precipice by the housing markets. In 2009 and 2010, when the crisis was arguably at its worst, the Housing Assistance Council began receiving frequent inquiries from the press and others asking, “How is the housing crisis affecting rural America?” We simply had no answer. Mortgage and foreclosure data were virtually nonexistent for most rural areas.

After six years and some hindsight, we are asking some questions ourselves. Is the crisis over? And what are the lingering effects? These seemingly basic inquiries still prove challenging, particularly from the rural perspective. So we sought assistance from four affordable housing experts to help answer these questions.

Read the complete blog post at Rooflines.

GAO reports on manufactured housing

A new GAO report on manufactured housing addresses Efforts Needed to Enhance Program Effectiveness and Ensure Funding Stability. The report includes several recommendations for federal agencies to improve their use of manufactured housing.

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