USDA Loan Eligibility. The United States Department of Agriculture offers direct and guaranteed loans to home buyers.
- Loans can to towards purchasing, building or renovating a home in a rural or small town area.
- Loans can also be used for water and sewage improvements.
- USDA Rural Home Loans have income and eligibility guidelines. Generally, for a guaranteed loan you must be employed and show that you are able to make your monthly housing payments.
- You must be in need of more adequate housing than you are currently in.
- If you are not eligible for a direct loan from the USDA, you may be eligible for a guaranteed loan from one of many lenders.
Learn more about USDA loan eligibility requirements and you may soon be in the home of your dreams.
USDA Loan Credit Qualifications. USDA rural housing loans require an acceptable credit history, but the guidelines are much more lenient than those for an FHA or conventional loan.
- If your credit is not quite up to par you still have a chance of getting a USDA loan.
- If, for example, you have had circumstances beyond your control, such as illness or a layoff, and these circumstances are temporary in nature, lenders can give you a break with a credit history waiver.
- If your credit is good, but still has a few negative items, you probably have an excellent chance.
- Lenders are more lenient since USDA rural home loans are guaranteed by the U.S. government.
Learn about USDA loan credit qualifications to see if you are a good fit for a USDA housing loan.
USDA Loan Property Eligibility. Unlike a conventional or FHA loan, the USDA rural housing loan has specific requirements on property eligibility.
- Although most people think of these types of loans as “farm loans,” in fact they are targeted for single family dwellings that are located in a USDA qualified rural area. This includes areas of open country, towns with populations of 10,000 or less, and under certain conditions, larger towns and cities.
- Some types of properties are not eligible, even if they are in rural areas. These include actual farms and hobby farms, multi-unit properties and existing manufactured homes.
Find out if the home you are interested in meets the USDA loan property eligibility requirements.
Guaranteed USDA Rural Home Loan and USDA Direct Home Loan. The U.S. Department of Agriculture offers two ways to help you get into the rural home you desire.
- One way is the Guaranteed USDA Rural Home Loan, which is a loan that is guaranteed against default by the U.S. government. It is funded by a traditional bank or other lender.
- The other is the USDA Direct Home Loan, which is funded directly by the USDA.
- While the Guaranteed loan has an income limit of 115% of the median area income, to qualify for the Direct loan your income must be 80% of the median area income or less, making the Direct loan a good choice for low and very low income families.
You must meet credit and eligibility guidelines and the property must fall under the specific requirements for a USDA home loan. Read more about the two types of USDA rural home loans.
USDA Rural Home Loans are one of the best deals in today’s real estate market. Be smart, learn more and apply on this site today for a free quote. It only takes a few minutes to be on your way to home ownership.
