Over 97% of the land mass of the United States is in an eligible USDA financing area.
Americans living in rural areas have a multitude of opportunities when it comes to home ownership. The Department of Agriculture (USDA) currently has a few loan programs aimed at helping people own or repair their homes. In addition, the USDA also provides financing to the elderly, disables, and those who are experiencing financial difficulties.
In 2016, the USDA invested almost $15 billion as part of its Rural Development program. During that year, the program assisted 140,000 families purchasing or improving homes.
USDA has always been known for the contribution it makes to promote housing in rural America. The biggest advantage for USDA home loan purchases is the $0 down loan with closing costs rolled into the new loan.Click here for a free USDA quote.
Here are some highlights of the most popular programs USDA provides:
- Guaranteed Loan: Applicants with reasonable credit and income up to 115% of the area median income can use this loan to finance 100% of the purchase price of a home and can finance the closing costs.
- Direct Loan (Section 502): This program is used to help low-income individuals or households purchase homes in rural areas with 100% financing. These funds are used to build, repair, renovate, or relocate a home. The Direct Loan can also be used to purchase or prepare a home site and provide water or sewage facilities to the site.
- Section 504 Loans and Grants: These funds are provided to very low-income owner occupants in rural areas for repairs to improve or modernize a home, make it safer or more sanitary, to remove health and safety hazards.
It is important to work with a qualified USDA lender who understands to pros and cons of a USDA loan in rural housing versus the other financing options. Most lenders have no idea that you can buy a home with $0 down and financed closing costs, and use that program in 97% of the land mass of the US.Click here to get matched with a local lender and find out if USDA is an option for you.
USDA has a stated mission to helping improve the economy and quality of life in all of rural America by providing financial support for single and multi-family housing. Two key goals are (1) to enhance rural prosperity; and (2) to create thriving communities.
USDA might be your right choice if you fit within the geographical lending area and if you fit within any of the USDA programs’ income requirements. Qualifying is made easy. Down payment and closing costs requirements are eliminated as an obstacle..
Some 2017 Highlights that make VA good option for many include:
- 0% down payment
- Low fixed interest rates
- Roll closing costs into the new loan
- DPA grants can be applied to USDA loans to lower mortgage starting balance
- More flexible underwriting guidelines
- Guaranteed by the government
Complete details about USDA home loan programs and guidelines can be found at: https://www.rd.usda.gov/programs-services/all-programs/single-family-housing-programsClick here to find out about the many USDA programs.
Down Payment Assistance
USDA loans are not normally paired with down payment assistance programs since they do not require a down payment to begin with. You can finance up to 100% pf the appraised value of the home value of the home you are purchasing. This is one of the only true 100% financing programs for non-veteran home-buyers left.
Though less common, almost every state has a down payment assistance program that can be paired with a USDA loan program. This helps keep help keep mortgage balances and mortgage payments lower for home buyers with the greatest needs.
DPA funds typically come in the form of a federal grant, a local bond program, bank subsidy projects, or a funding initiative sponsored by a local group. Grants are not paid back—it is free money.
Be sure to talk to a qualified local USDA lender who is also certified to administer DPA programs in your state and local jurisdiction. Work with a trusted USDA advisor who will listen to your needs and understand your situation. A trusted USDA advisor can present ALL your personal options.