What is a USDA Loan?
An USDA loan is a mortgage option that is issued by qualified lenders and guaranteed by the United States Department of Agriculture (USDA). It is the only mortgage option available to non-veterans that does not require a down payment. It also allows gift or assistance funds to be used for closing costs.
The Rural Development program is set up to help low to moderate income households make their dream of homeownership become achievable with the help of a trusted lender. Having the option of affordable homeownership opportunities can boost the community’s economy and improves the quality of life. Becoming a homeowner can also free you from the rules and regulations of renting!
Who is Eligible?
USDA loans are based on income and location. You must meet the income-eligibility, which is 115 percent of the median household income in the area the home is being purchased. Another requirement is that it must be your primary residence that you must occupy. Also, you must maintain U.S. citizenship or be a qualified U.S. non-citizen national. Contact your local home loan advisor to see if you qualify.
The homes must be in a “rural” area as defined by the USDA’s map. Most small towns, suburbs, and exurbs of major U.S. cities are included in the eligibility map. Please check to see if your property is in the USDA eligible property.
There are no fixed credit requirements with the USDA, but your lender may have different requirements. Although, you should consult your loan advisors for specific requirements and to see if you qualify. In order to receive this loan, you must demonstrate a willingness and ability to repay any debts you previously and currently have. Also, your debt-to-income (DTI) ratio should not exceed 41 percent.
How Can I Apply?
Contact your mortgage advisors to discuss if you qualify for an USDA loan today! JTS & Co. is an award winning and locally trusted team of mortgage professionals. Contact us today to get a free consultation to discuss your situation and get personalized advice.