Looking into a USDA housing loan? The U.S. Department of Agriculture offers Guaranteed USDA Rural Home Loans to borrowers in rural and small town areas who want to purchase a new home, build a home, or buy an existing home. USDA housing loans have easier qualification standards and financing and offer many more advantages than traditional or FHA mortgages. Many properties that are outside a major metropolitan area qualify for a USDA loan. Here are some of the advantages of a USDA Rural Home Loan.
Benefits of USDA housing loans
- Perhaps the most compelling reason to apply for a USDA Rural Home Loan is that you are not required to put a down payment on the house. That’s right, it is one of the few 100% financing options left out there. This is a huge benefit for families who don’t have the 20% down payment that is required in a traditional home loan.
- There is no maximum price for USDA rural housing loans. The amount financed is based on your ability to pay.
- You will not have to pay expensive mortgage insurance as you would with an FHA mortgage.
- If your credit is not perfect, you can still qualify for a USDA housing loan. There is no minimum credit score requirement. You only have to show the ability and willingness to make your mortgage payments and that you do not have resources to qualify for a traditional home loan.
- Loans are up to 33-38 year fixed-rate mortgages.
- Because the U.S. government guarantees the loan, lenders typically offer lower interest rates than they could on an FHA or conventional loan.
- If the property you are purchasing needs fixing up, you can finance the cost of repairs in the mortgage, up to 100% of the “as-is” value.
- You may finance up to 102% of the appraised value.
- You may receive a grant or gift from a non-profit and use it towards closing costs or down payment assistance.
- The seller can make unlimited concessions, including paying closing costs.
- Loans can be used for purchasing a new home or refinancing an existing mortgage.
USDA Rural Home Loans offer outstanding benefits to home buyers. Find out if you are eligible by taking 2 minutes and applying on this site for a free quote.