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Program Assessment


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Single Family Housing Loan Guarantees

USDA's Rural Housing Service (RHS) provides loan guarantees to means-tested borrowers to obtain homeownership in rural areas. RHS guarantees up to 90 percent of a private loan for low to moderate-income rural residents. The program's emphasis is on reducing the number of rural residents living in substandard housing.


What This Rating Means


This is the highest rating a program can achieve. Programs rated Effective set ambitious goals, achieve results, are well-managed and improve efficiency.
  • The program is well targeted using both income and location for criteria. However, there is redundancy with other Federal guaranteed home loan programs. It is not considered extensive, and the Administration has proposed changes to this program's authorization to reduce the redundancy with the other Federal home loan guarantee programs in situations where the lender happens to offer them all.
  • The program is free of design flaws. In the past, lenders using the program threatened to not participate if the funding for the program ran out prior to the end of the fiscal year. The program has corrected this flaw by designing controls that will better ensure steady funding and access to the program throughout the fiscal year.
  • The program has appropriate long-term goals and annual measures, and they are also ambitious and challenging. An example of one the quality measures is the program's delinquency and default rates, which compare favorably to the national rate, given a riskier pool of borrowers.

Improvement Plan

About Improvement Plans

We are taking the following actions to improve the performance of the program:

  • Working with the Congress to change this program's authorization to help reduce any redundancy with other Federal home loan guarantee programs.
  • Evaluating the controls that ensure steady funding and access to the program by the lenders to make sure they are adequate to retain lenders in the face of limited funding in any given year.

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