H.R. 5728, the Rural Homeownership Continuity Act of 2025, amends federal law to allow borrowers to transfer Rural Housing Service loans to qualified buyers when selling rural properties. Currently, the Doug Bereuter Section 502 Single Family Housing Loan Guarantee Program—which helps low- and moderate-income rural residents buy homes—does not permit loan assumptions, meaning new buyers must obtain separate financing and original borrowers remain liable for the debt. This bill enables eligible buyers to assume existing loans upon property transfer, and it releases original borrowers and any co-borrowers from further liability. The legislation applies to loans guaranteed under this program starting from the date it is enacted, and it allows the Department of Agriculture to establish rules permitting loan servicers to charge borrowers reasonable fees for processing assumption transactions. The bill essentially aims to make rural homeownership more flexible and transferable while reducing barriers for rural property sales.
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