Blog Posts
Jennifer Emerling / There Is More Work To Be Done
Jennifer Emerling / There Is More Work To Be Done
Loan Guarantees Are Not Enough
Loan Guarantees Are Not Enough
By Leslie Strauss
September 13, 2012
It’s less expensive for the government to guarantee a loan made by a bank than to be the lender itself. FHA and VA loan guarantees are well known and well used. It’s not surprising, then, that there has been a shift in USDA’s lending too, away from direct loans towards guarantees, especially after recent changes made USDA’s guarantee programs self-supporting. But guarantees cannot replace direct loans — they serve different populations.