The federal government is using a lower mortgage interest rate to encourage folks to move into rural areas of states like Iowa and buy homes. Donna Jarzynka, an area specialist for the U.S.D.A., says the goal is to get people rooted.

Jarzynka says, “Homeownership, certainly, we’re hoping will help our smaller communities thrive because homeownership gives that person ownership in that community.” She says U.S.D.A. Rural Development is offering home loans with no down payment and low interest rates for qualifying applicants in rural Iowa.

She says the monthly interest rate of 4.5% was put into place on August 1st, falling from 4.625%. The loan programs are for low and very-low income families in communities with populations under 20-thousand. Jarzynka says the money comes from a combination of a state’s annual operating budget and some funds from the American Recovery and Reinvestment Act.

She says two pots of money are available, the normal appropriation and extra funds through the federal stimulus package. Individuals or families must be within income guidelines that are established by counties.

 To learn more, visit “www.usda.gov” and click on the Rural and Community Development link.