close

Uniontown population drop opens door for mortgage programs

By Christine Haines chaines@heraldstandard.Com 5 min read

Losing population may be a winning proposition for the city of Uniontown.

According to the U.S. Department of Agriculture, Uniontown has slipped below 10,000 in population, making its residents eligible for several USDA Rural Development housing loan and grant programs. Increasing the number of homeowners and making improvements to existing homes could improve the tax base for the city as well.

The 2010 Census had the city at more than 10,000 residents, making it ineligible for the Rural Development programs, but a mid-census review showed that the population has dropped to 9,972.

“It would open up a lot of mortgage money for Uniontown,” said Tom Williams, the state director for USDA Rural Development.

Williams said even if there is a sudden growth pushing the city back over the 10,000 figure, the money will remain available for several more years.

“They’re not going to do another census until 2020, so you should be good,” Williams said.

Williams said the USDA Rural Development is now offering three programs to Uniontown that have been available in more rural areas of the county for a while. The single family guaranteed housing loan program is for middle income residents going through a conventional bank for a mortgage, but without the need for a down payment, Williams said.

“This is a program banks apply for,” Williams said.

The guaranteed housing loan program offers a 100 percent guarantee for the mortgage loan made by the bank a conventional rates. Private mortgage insurance is not required.

“This program is for people who may not have a downpayment, but have good credit and are ready for homeownership,” Williams said. “Homeownership changes everything for people.”

Rural development offers another mortgage program for individuals with lower incomes and credit scores that may not be high enough to land a private mortgage, guaranteed or not. A third program the USDA is now offering to Uniontown residents is a loan program for extremely low-income homeowners providing up to $20,000 to make repairs to their property for safety essentials such as heating, roofs and windows.

“Closely coordinated with this, if the person is 62 or older, we can give them a $7,500 grant,” Williams said.

Williams said the interest rate on the loans is very low, resulting in repayment plans that are affordable.

“It comes to about $5 per month for each $1,000 borrowed. Our default rates are extremely low in these programs,” Williams said.

David Corwin, the USDA’s program director for housing in Pennsylvania, said the income guidelines open the programs to a wide population. The guaranteed loan program accepts applicants who are within 115% of the median income for the county. For Fayette County that means a family of up to four people may have a family income of up to $79,550; for 5-8 people, the limit is $105,550. There is no cap on the mortgage amount for the guaranteed mortgage program, as long as the applicant is able to afford the payment.

Corwin said participants in the direct loan program must fall under 80 percent of the median income for the area, which is $38,900 for one person in Fayette County and up to $55,600 for a family of four. Mortgages written under the direct loan program are offered for terms of 33 to 38 years with a maximum purchase price of $169,000. Corwin said that price can include needed improvements, as long as the total price does not go above the value of the house.

“It’s subsidized. They get to pay as if the interest rate is 1 percent and the subsidy makes up the difference,” Corwin said.

Because of the subsidy and extended loan payments, monthly mortgage amounts may be lower than people expect. Corwin said a house with a $100,000 purchase price would have a $485 monthly payment based on $135 monthly for property taxes and $50 monthly for homeowner’s insurance. A house with a $50,000 purchase price would have a $335 estimated monthly payment based on same assumptions for escrows.

Corwin said the housing repair loans and grants can be used to make a house safer or even for renovations needed to improve handicapped accessibility so a person can remain in his or her own home.

“We’re going to help people whenever we can,” Corwin said.

Uniontown Redevelopment Authority Director Mark Rafail said the loan program could help some of the people on the city’s list for housing rehabilitation.

“The redevelopment authority has nine properties that need to be rehabilitated. Because we’re so limited in our CDBG (Community Development Block Grant) money, we can only do two or three a year,” Rafail said.

Rafail said the mortgage programs may also be of assistance to individuals considering purchasing one of the new homes built by the authority on Lemon Street, or one of the empty homes in the city that need some repairs.

“It will enhance the efforts of the Redevelopment Authority because it opens new opportunities for home buyers,” Rafail said.

For more information about the program, contact the USDA Rural Development housing program at 717-237-2186.

CUSTOMER LOGIN

If you have an account and are registered for online access, sign in with your email address and password below.

NEW CUSTOMERS/UNREGISTERED ACCOUNTS

Never been a subscriber and want to subscribe, click the Subscribe button below.

Starting at $4.79/week.

Subscribe Today