USDA Loans

A USDA Loan is a mortgage loan that is insured by the US Department of Agriculture and available to qualified individuals who are purchasing or refinancing their home loan in an area that is not considered a major metropolitan area by USDA.

If you’re looking for a 100% financing program and don’t mind living outside the city, the USDA (United States Department of Agriculture) program may be right for you.  To find out if an area or a specific property is eligible, follow this  link  to the USDA’s site to determine the “Property Eligibility.”  You can click  here  to get information about the income limits for the USDA program.  This program is unlike any other program in that the income of every person living in the household is counted toward the income limit, even if that person will not be on the loan.  There are exceptions to this rule but it complex so we recommend you reaching out to us with specific questions about eligibility.

USDA has a one-time upfront fee of 1% (can be financed into the loan) in addition to the regular costs associated with purchasing a home and an annual fee of .35% (paid monthly as part of the monthly mortgage payment).  

 

Great for First-time Home Buyers

100% Financing (including Closing Costs)

No Down Payment Requirements

No Prepayment Penalties

Low Rates

Existing Homes, Foreclosures, New Construction

Benefits of USDA Loans

• 100% Financing - you can buy a home with no money down. In some cases you can even finance your closing costs.
• You can refinance your home up to 100% of the value of your home.
• Low Fixed Rate Mortgage Options.
• They are usually easier to get because the Government insures the loan so that there is much less risk to the lender.
• They can be used for Existing Homes, Foreclosures or New Construction.
• Simple Loan Process.
• No Loan Limit. No Acreage Limit.
• There is No Prepayment Penalty.
• You can use the loan to repair or add on to your home.
• Flexible Credit Requirements.

Who is eligible for a USDA Loan?

Generally these loans are available to anyone who meets minimum credit guidelines and local area income requirements and is purchasing a home or refinancing their home in an area that is not considered a major metropolitan area by USDA.

Some common misconceptions of USDA Loans:

• They are just for farmers - USDA Loans are not "just for farmers," millions of people from all walks of life already qualify.
• FHA or Conventional Loans are better - USDA Loans often offer better terms than an FHA or conventional loans.
• They aren't flexible - Actually, USDA Home Loans can be used to buy a new home or refinance to a lower rate.
• Only certain people can qualify - Anyone who meets the income and credit guidelines can qualify for a USDA Home Loan.
• They are only for rural areas - Actually, USDA Loans are available in many areas that most people would not consider rural. For example, many small communities just outside of metropolitan areas qualify as rural areas according to the US Department of Agriculture.
• They are harder to get than FHA or Conventional Loans - This just isn't true.  In many cases USDA Loans are actually easier to get because the loans are guaranteed by the government.

These materials are not from HUD or FHA and were not approved by HUD or a government agency.