A USDA Home Loan is made by an approved lender and guaranteed by the US Department of Agriculture. To qualify, the subject property must be located in an eligible rural area as determined by the USDA, and the borrower must be within the eligible income limits as determined by the USDA. Only single family, owner occupied residences may be financed by a USDA loan.
The underwriting guidelines are less strict than for Conventional loans. There is no down payment requirement. The credit requirements are relatively lenient, allowing for prior bankruptcies and lower credit scores. Gift funds and seller concessions are permitted. Closing costs and pre-paid costs may be rolled in to the loan if the property appraises for more than the selling price.
USDA home loans require an upfront guarantee fee, which may be financed into the cost of the loan. There is also a small monthly guarantee fee that is due with the monthly mortgage payment.
Contact us at 888-933-8639 today, to see if the USDA loan is the right loan product for you.