A USDA Guaranteed Home Loan is one of the two loans that are part of the USDA (United States Department of Agriculture) loan program also called as the USDA Rural Development Guaranteed Housing Loan Program also referred to as the Section 502 loans. The other is a USDA Direct Home Loan Program. As the name implies, it is extended directly by the USDA to qualified buyers, typically, borrowers who belong to the low income bracket; looking to buy a residential property in a USDA home loans designated eligible area.
USDA Guaranteed Loan deals with families who are looking to have decent housing and are able to pay for a monthly mortgage, including taxes and insurance. They should generally belong to the moderate-to-low-income household. On top of that, applicants should definitely have acceptable credit history. Also, the property being purchased must be within the range of USDA RD Home Loan footprint, but this does not mean you cannot have the house of your dreams.
If an applicant qualifies, USDA offers 100% financing. Along with this, they allow the seller to pay for the closing costs, up to $10,000. USDA Home Loans have definitive USDA household income limits that tend to change with respect to the County the applicant purchases home from.
The maximum USDA household income limit is not just for the applicant, but for every single person in the family household that earns any amount. The household limit usually becomes a problem because there a few deductions that the USDA Underwriters allow and disallow when reviewing a borrowers personal tax returns.
There’s a list of USDA approved lenders for the Guaranteed Home Loan program an applicant can get a mortgage loan from. AMCAP Mortgage is a USDA approved Guaranteed Home Loan Program lender in Austin and surrounding areas.
USDA loan requirements are not so hard to comply with. The basic credit, income and asset requirement apply to all USDA Guaranteed Home Loan borrowers. As part of the requirement, borrowers must have a 640 middle FICO score and cannot have more than $15,000 in non-retirement funds.
The mortgage term for a USDA loan is fixed for 30 years. Typically, the rate of a USDA home loan is lower compared to other types of mortgages. Also, there is no Mortgage Insurance, like an FHA insured loan.
The house being purchased must meet the voluntary national model building code. They should be constructed, purchased and rehabilitated according to this standard. New built home must meet the HUD Manufactured Housing Construction and Safety Standards and HCFP thermal and site standards.
Buying a house used to be a real cash-engaging decision, but now, the USDA guaranteed home loans have given a whole new meaning to ‘buying a house of your dreams’. All you have to do is qualify for the USDA loan and follow the criteria. The loan eligibility is not really an issue as long as you meet the financial requirement and ready to follow the terms and conditions set forth by the US Department of Agriculture housing program.
So, if you’re one of those people who can’t afford to bear a better standard of housing in Austin, Texas, and are absolutely not up for the traditional bank loans, then USDA Guaranteed Loans is right here to help you get back on your feet and get you a house you’ve always wanted to live in.
Contact our USDA Home Loan Specialist for more information, at 512-779-4997, or see if you are eligible for 100% via the USDA Guaranteed Home Loan program.