GARDNER, Kan. - One community in the Kansas City metro has grown so much in the last decade, a federal loan program enticing people to buy there could soon end.
The population in Gardner, Kan., in 2000 was 9,396, making it eligible for the USDA's Rural Housing Program. The program enabled homebuyers to save thousands of dollars by allowing those who meet certain income requirements to not have to make a down payment.
Wendy McDermott with Real Estate Mortgage Network has watched as the program helped people buy their own homes.
"Especially for new buyers that maybe don't have a lot of assets for down payment, USDA funding is always an option you want to mention," said McDermott. "USDA financing is designed to build communities. It worked."
The USDA loan option has made many homebuyers consider Gardner before other suburbs. Katie Yeager with Your Future Address has sold homes in the community because of the loan program.
"They are making that option because of the zero percent down, not necessarily because it's their first pick," Yeager explained.
But in the 2010 U.S. Census the population in Gardner jumped to 19,123. If the program ends, others areas could instantly benefit.
"If it's an even playing field, let's say that someone is looking at Olathe and they have the 3.5 percent down, they might choose to buy a home in Olathe instead of choosing to buy a home in Gardner," Yeager said.
Those in the market for a new home or those who are considering refinancing shouldn't wait.
"Right now, I would tell anybody get those purchase contracts to be closing before March 27," McDermott advised.
The USDA sent the following statement about the possibility the loan program could end:
USDA Rural Development administers more than 40 different programs that are delivered through three agencies: Rural Utilities Service, Rural Housing Service, and Rural Business-Cooperative Service. These programs are authorized by several different laws periodically reauthorized by Congress, including as part of the Farm Bill. We recognize the importance of this issue to our borrowers, lenders and rural communities. Under the terms of these laws, and their rural definitions, USDA provides services specifically to rural communities that might not otherwise receive this funding. Pursuant to law, a reassessment of eligible areas is conducted every decade based on new U.S. census data. That process continues.
For more information on the program, go to http://1.usa.gov/15ItvF