USDA Rural Development has announced its allocation for direct single-family loans for fiscal year 2010. Due to an increased level of funding as a result of the American Recovery and Reinvestment Act, USDA Rural Development in Texas has more than $130 million in direct funding available to help families achieve the dream of home ownership.

USDA Rural Development’s direct program provides low-interest, no-down-payment loans to help eligible families living in rural communities and rural areas purchase their own homes.

The Direct Rural Housing Program is geared toward low- to very low-income families. No down payment is required and closing costs may be included in the loan.

Under the program, an application may be eligible for payment assistance, which would subsidize the interest portion of the house payment down to as low as 1 percent, lowering the overall monthly payment amount.

In many cases, the total monthly house payment, including taxes and insurance, may actually be less than a family is paying for rent.

Homes must be located in a community of 10,000 persons or less and locations not closely associated with urban areas. Under certain circumstances, loans can be made in towns and cities between 10,000 and 25,000 in population. Never assume an area is not eligible, said a USDA official.

For more information on housing programs, contact the Hillsboro office at (254) 582-7328, ext. 4 or visit www.rurdev.usda.gov/tx.