Rock Island Today

FREEPORT, IL – Congressman Eric Sorensen (IL-17) urged the Department of Agriculture (USDA) to protect access to safe and affordable housing in Freeport. His letter requests the USDA grant an exception for Freeport so it can maintain eligibility under vital rural development programs. 

“Cutting off access to critical housing programs would be devastating to working families in Freeport who depend on these resources to achieve the dream of homeownership,” said Sorensen. “The USDA must extend the exception to ensure Freeport residents continue to be eligible for these important programs.” 

“The USDA’s 502 Guaranteed Loan Program is critical to providing equitable homeownership within the City of Freeport and directly supports our Strategic Plan. I’m grateful that Congressman Sorensen is standing up for homeownership in Freeport,” said Freeport Mayor Jodi Miller. 

"We are incredibly grateful to Congressman Sorensen for recognizing the vital role of the 502 Guaranteed Loan Program in providing homeownership opportunities in Freeport. This program has allowed thousands of first-time homebuyers to secure financing for homeownership while investing in the Freeport community and building generational wealth," said Amy Barnes, President of the Tri-County Chapter of the NorthWest Illinois Alliance of REALTORS. 

Freeport’s population of nearly 24,000 exceeds the 20,000 threshold to be designated as “rural in nature” for USDA’s Rural Development Loan Programs. As a result, Freeport is slated to become ineligible for many vital services later this year, including the 502 Guaranteed Loan Program. 

The 502 Guaranteed Loan Program helps low-and moderate-income households in rural areas make homeownership a reality. This loan is often the only option for purchasing or improving a home in rural communities, where access to financing is limited. 

Read Congressman Sorensen’s full letter here and below: 

Dear Deputy Secretary Torres Small,   

I write to you today on behalf of Freeport, Illinois, a community in the northwestern region of Illinois that I represent. Freeport currently qualifies for the United States Department of Agriculture’s (USDA) Rural Development Loan Programs. However, Freeport is slated to lose its “rural in nature” designation later this year. This would remove Freeport’s eligibility for many of USDA’s rural housing programs, notably and most vitally the 502 Guaranteed Loan Program. Freeport’s population is almost 24,000, just over the designation’s 20,000 threshold. The loss of access to the 502 Guaranteed Loan Program would be devastating to the community.   

The 502 Guaranteed Loan Program helps lenders work with low-and moderate-income households in rural areas to make homeownership a reality. This loan is often the only option for purchasing or improving a home in rural communities, where access to mortgage financing is limited. The 502 Guaranteed Loan Program in Freeport is vital and allows residents access to safe, and affordable housing. In addition, residents use these loans to purchase, build, rehabilitate, and improve housing stock.    

The City of Freeport’s 2020 Comprehensive Plan addresses several housing-related topics.  A central concern is the unmaintained, aging homes that burden homeowners and potential homebuyers due to the cost of rehabilitation. The 502 Guaranteed Loan Program provides access to financial resources to redevelop these properties for the purpose of market-rate workforce housing – the foundation of a successful housing rehabilitation strategy.   

Furthermore, mortgage lenders in the area champion the 502 Guaranteed Loan Program as the leading and favored loan type for current and potential homeowners for two reasons. First, the loan program guidelines are most attractive for first-time homebuyers and buyers with limited financial options. Second, the program provides a 90% loan note guarantee to approved lenders to reduce the risk of extending 100% loans to low-and moderate-income homebuyers. For example, one lender in the area, Citizens State Bank, has issued 104 loans totaling more than $6.6 million in access to homeownership investment over the past five years. More loans would have been procurable if not for the community's highly competitive housing market and inventory challenges.   

The 2023 Stephenson County Housing study indicates that 49% (2,290) of renters are considered cost-burdened in Freeport, which is the highest in an entire region that includes Stephenson, Ogle, Lee, Jo Daviess, Carroll, and Whiteside Counties. Of households with a mortgage in Freeport, 16.8% (1,060) are currently housing cost-burdened. Therefore, it is imperative that the 502 Guaranteed Loan Program remains accessible and available to renters in their transition to homeownership which is often more affordable than renting. Homeownership is a central part of Freeport’s thriving community, and most residents in the area can finance that dream of homeownership with a USDA loan.   

 USDA has made exceptions for Freeport in the past, most recently in 2018. I request that this exception be made again.  

Congressman Eric Sorensen is the first openly LGBTQ person elected to represent Illinois at the federal level and is a member of the New Democrat Coalition. He serves on the House Committee on Agriculture and the House Committee on Science, Space, and Technology. Prior to serving in Congress, Sorensen was a local meteorologist in Rockford and the Quad Cities for nearly 20 years. His district includes Illinois’ Quad Cities, Rockford, Peoria, and Bloomington-Normal. 

Original source can be found here.