Ocean City Today

County opposes USDA exit from Ocean Pines

By Brian Gilliland | Feb 22, 2018

(Feb. 23, 2018) With the deadline to submit comments to the U.S. Department of Agriculture regarding its review of the Ocean Pines area for eligibility in its rural development program approaching rapidly, the Worcester County Commissioners approved sending a letter supporting the program.

The USDA offers no money down, 100 percent financed fixed-rate mortgages for families of one-to-four people earning less than $96,150 per year, according to Jo Ellen Bynam, program administrator.

The USDA loans are attractive to homebuyers and lenders, because a portion of the mortgage is guaranteed by the federal government, giving lenders more confidence in the ability of the applicant to repay the loan. This confidence also plays out in the interest rate, which is favorable to the buyer and also allows the home to be financed completely, without a down payment being required.

There are, however, some restrictions involved. The basic requirements are credit, income, property usage and home location.

The loans are also intended for use in rural areas, but the definition of rural in this context is intentionally vague.

Except for Ocean City, the loans are offered throughout Worcester County.

The USDA is conducting a review of all areas under its jurisdiction to identify places that no longer qualify as rural, and the only place in Worcester County to come under scrutiny is Ocean Pines.

The last review was conducted in 2013, using data from the 2010 census. The review is conducted every five years.

The new review will use data from the 2015 American Community Survey, which is also conducted by the Census Bureau.

“Our members who sell real estate in Ocean Pines say a large percentage of their clientele rely on rural housing programs, particularly the Single-Family Housing Guaranteed Loan Program,” Joel Maher, president of the Coastal Association of Realtors, wrote in defense of the program. “It is our concern that the USDA may mistake the demographics of Ocean Pines for those of Ocean City, the nearby resort destination and largely second-home market.”

Maher said local Multiple Listing Service data put the median Ocean Pines home value at $235,000, which is significantly lower than the national average.

The commissioners voted unanimously to send a letter of support of the program to the USDA.

Comments may be submitted to Brad King via email at brad.king@md.usda.gov. For details or questions on specific changes, contact the Delaware/Maryland Rural Development Housing Program at 301-797-0500 ext. 4.

The comment period expires 90 days from Dec. 1, 2017.

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