USDA Loans Make Rural Homeownership a Reality

Do feel more comfortable surrounded by open country rather than pavement and neighbors on both sides of your driveway? This is the case for many Americans. The USDA has made it easier for potential homeowners who want to live in rural areas.

USDA loans are mortgage loans backed by The U.S. Department of Agriculture in the same way The Department of Veteran Affairs back VA loans. USDA loans are backed through the Rural Housing Division of the U.S. Department of Agriculture. They are available to millions of eligible primary home buyers with low to moderate incomes or scarce funds for down payments.

Here is a list of Features, benefits and things you need to know about USDA Loans.

1. Zero Down

No down payment is required for USDA loans.

Thirty-year, fixed rate loans with no pre-payment penalty

Rates are very competitive with conventional loans

2. Eligible Property

The USDA loans are limited to “rural” areas, though you might be surprised by some of the suburbs of major metropolitan areas qualify as rural.

Homes should be modest in size, cost, and constructed per local codes and regulations.

3. Eligible Borrowers

Funds are available for qualified borrowers who earn up to 115% of the area median income. Even candidates who have had past credit issues with late payments, bankruptcies or foreclosure may be eligible.

Primary occupancy is required.

This program is not for investment properties.

4. Benefits

Minimum cash is needed to close.

The USDA Guarantee Fee and eligible closing costs may be financed.

Gift money, grant money and seller contributions are allowed.

If you have questions, want to find out if you qualify, or would like to learn more about the areas that meet the rural designation criteria, please don’t hesitate to reach out. We are happy to help.