USDA Loans Aren’t Just for Homebuyers

Traditionally, USDA home loans were simply thought of as a farmer’s loan. Only farmers used them to secure housing or to expand their family farms. That’s not the case anymore. To further assist the development of rural areas in Florida, USDA loans have expanded to include businesses, community facilities, and homes that are closer to metro areas.

Business Loans
For those with established businesses in more rural areas of Florida, the USDA provides Business and Industry Guaranteed Loans. Loans may be used to help a business maintain operations, to make updates to current facilities, or to help with the costs of expansion.

Businesses can qualify for a loan from the USDA if they are in a rural area, provide employment, improve the economic climate, improve the environmental climate, and promote conservation. Businesses are allowed to borrow up to $10 million without extra approval and up to $40 million with the approval of the United States Agriculture Secretary.

The Home Loan Program
For those interested in purchasing a home on the outskirts of one of Florida’s major metro areas or out in the country side, a USDA home loan may be the right financing option for you. Through a USDA home loan, lenders can secure a financing for zero money down. Benefits to the program include competitive interest rates, flexible loan terms, and no required mortgage insurance.

To better serve interested homebuyers, the program offers two types of loans: the Guaranteed Loan and the Direct Loan. The Guaranteed Loan is the mortgage usually distributed by the department while the Direct Loan is reserved for lower income households. In order to be eligible for either of these programs, interested homebuyers must simply:
· Seek to purchase a home in a USDA-approved rural area

· Be able to afford monthly mortgage payments

· Have an annual income that does not exceed 115 percent of the area’s median average income

The Housing Facilities Loan Assistance program implemented by the Department of Rural Development also offers assistance to individual needing help with farm and rental housing.

Community Loans
For rural communities wishing to further develop their areas, they may apply for Community Facilities Direct and Guaranteed Loans. Communities wishing to obtain funding may be up to 20,000 in population and must be in a USDA-approved rural area. Loans may be used to:
· Build new structures

· Renovate pre-existing structures

· Acquire land needed for public service buildings

· Labor and building materials needed to build structures.

Just recently, the USDA has agreed to pump nearly $2 million into rural energy programs in Minnesota alone. Since 2009, the USDA has invested nearly $3 billion in rural Minnesota for housing, infrastructure, community facilities, businesses, and job creation. Although this sounds like a lot, Minnesota isn’t the only state receiving this type of assistance. Agriculture Secretary Tom Vilsack announced last week that the USDA will provide $603 million to electric co-ops across the nation.

Following suite, Florida’s Department of Rural Development intends to help communities continue to establish themselves positively and experience prosperity. If you or your community is interested in obtaining USDA financing, contact your local Rural Development Office for further information.

Kevin Pearia
Content Director for”

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