Lagniappe Living in Lake Charles, Louisiana

Rural Development Loans in Louisiana-Changing Again Oct 1

***********Update since post on 9-21*************************

Senate passed a one year extension on the National Flood Insurance Program NFIP by unamimous consent



Rural Development Loans in Louisiana-Changing Again Oct 1


In Southwest Louisiana 100% USDA Financing is an extremely popular loan.  We have been fortunate in Calcasieu Parish that due to recent storms (which worked in our favor) we have had our funds replenished and as a result many first time home buyers have been able to purchase a home with this avenue of financing.


We already have the obstacle of overcoming Flood Insurance and the NFIP will be expiring again September 30th.  Now there is a new flood insurance update for USDA loans that will effect loan submissions.   I am quoting from an email  I received from Progressive Mortgage here in Lake Charles that outlines changes in USDA loans effective October 1, 2010.


"Effective October 1, 2010, any loan submission for an existing dwelling located in a Special Flood Hazard Area (SFHA) must contain an elevation certificate showing the first floor elevation of the habitable space above the 100-year (base) flood zone elevation.  In addition, the dwelling must be served by public utilities that are located and constructed to minimize or eliminate flood damage, OR must have an on-site water supply and waste disposal system located and constructed to avoid contamination of the water supply by the septic system due to flooding. Elevations for all mechanical and electrical components that comprise the private mechanical waste disposal system, water supply system and HVAC system (central air conditioning unit) must be noted on sections C and D of the Flood Elevation Certificate (FEMA Form 81-31) by the authorized certifier.


In the past, Louisiana has received exception authority to approve existing dwellings with first floor habitable elevations located below the 100-year flood zone elevation, but this exception authority will expire on September 30, 2010. 


In addition, file must contain documentation there is no practical alternative to purchasing home in a SFHA in accordance with RD Instruction 1980-D, 1980.318.  This requirement applies to both new construction and existing dwellings.


Loan submissions for properties in SFHAs that do not include these items will be considered incomplete. 


If you have any questions about this notice, please contact your lender or the Louisiana Guaranteed Rural Housing division at (318) 473-7910."


My thoughts on this is why does USDA have to mess with a good thing?   Since Hurricane Rita in 2005 alot of homeowners have obtained Elevation Certificates for their property, its a good thing to have because it can lower your Flood Insurance Policy.  When homeowners decide to sell their said properties, if they have an Elevation Certificate it is helpful it that is included with the listing because a Buyer will meed to obtain their own flood insurance policy (if required) and it will help to reduce that Flood Insurance quote.  I'm all in favor of that especially when it comes to those ratios lenders keep a watchful eye on.

However, now I think it is getting a bit crazy to  now require that HVAC and Mechanical Sewers and/or Wells  be elevated.  This is just another expense and who pays for that???  If it wasn't already hard enough to remove the stigma with homes in flood zones.....this is the State of Louisiana and we have Bayou's, Rivers and Lakes.  FEMA has re-zoned the maps and alot of things are changing.  What used to NOT be in a flood zone is now IN a flood a zone with the new maps.  Mapping is entirely another topic!

Just sharing,,, this informational post.  We will all do what we have to do, but its time to stop messing with what is already in place.  I am glad I am not a loan officer with all the changes to regulations and guidelines you have to keep up with, God Bless you!  Thanks for letting me vent a bit and as  the Queen of Disco Donna Summer would say....... No More Tears Enough is Enough!




For more information on Lake Charles Real Estate, visit my website.  You can search homes for sale in Lake Charles, Louisiana,  and view up to date information on Lake Charles Subdivisions, Neighborhoods

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If you are planning a move to or from the Lake Charles, LA area, I can help!   I am a full time Realtor licensed by the Louisiana Real Estate Commission and am affiliated with:

Century 21 Mike D. Bono & Co.'s

4410 Nelson Road, Lake Charles, LA, 70605 USA

337-478-1578 or 337-499-9592

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Comment balloon 5 commentsMarilyn Boudreaux • September 21 2010 02:09PM
Rural Development Loans in Louisiana-Changing Again Oct 1
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