Guarantee on loan through section 538

[Michael Pendleton]

Currently I'm looking at a multi unit apartment complex and I only have the ability to put 10% down including the construction loan I would need to take out.. I live in a rural low income area and would possibly be able to apply for a usda rural housing loan guarantee. With this guarantee it would allow me to take a loan out with only putting 10% percent down but would cap my rent prices at a certain level to appeal to low income renters. This however isn't a huge concern for me considering most renters in my town are living in low income apartments. A couple concerns I have is one I would need to hire a property management company per requirement of the guarantee which something I had wanted to manage. Also I couldn't find any insights on my ability to be able to refinance or even get out of the guarantee stipulations in the future. Any one have any insights?

[Mark Douglas]

Hey @Michael Pendleton !  I work with the USDA in Nashville, TN, but in the single family mortgage division, so I'm not sure about the particular requirements for the 538 loan.  But, you'll want to reach out the Las Cruces Area Office (they cover Sierra County) and ask for the Area Director, Clyde Hudson, or the Housing Program Director Art Garcia. 

I couldn't post their #, but it's on this page -->

https://www.rd.usda.gov/contact-us/state-offices/nm

I'm sure they'll be able to walk you through the requirements.

Hope this helps !

-Mark