What are the requirements for the USDA program in Denton? So that’s going to be looking at a 640 minimum credit score requirement.
There is a income requirement too when applying for a USDA Loan Denton.
So basically the income requirement is about 78,000 if you’re in a family of 1 to 4 if you’re in a family of 5+ that’s gonna go up to about $103,000 on the income limit.
The big requirement for USDA is that it’s property specific.
It’s got to be in a USDA Approved Zone. How much down payment does this program require?
It’s actually 0% down payment which is Great!
Ok Awesome, and how much does the average home buyer come in with out-of-pocket?
So because your down payment for a USDA Loan in Denton is covered you’re just gonna have to come in with again your prepaid and closing cost So if it was a $300,000 purchase.
you’d be looking at about $7,500 cash for keys to get in the home.
What type of home buyer is the USDA Loan program Ideal for? So this is going to be ideal for the home buyer that’s looking for a property in those specific areas.
Ideally it’s properties that are going to be USDA Eligible rural zones.
So not right in the middle of the city, but maybe if it’s more on the outskirts, on a little bit of land, lower tax rate areas that’s probably going to be a property that’s eligible and that would be ideal because that one would probably qualify OK, Fantastic.
What is a USDA Home Loan?
I bet you’re wondering, what is a USDA home loan?
Designed with the residents of more rural areas in mind, the United States Department of Agriculture designed its loan program to enrich rural communities by providing affordable home loan options to low-income households that may not be able to secure home financing through other means.
Who has time to stop and smell the roses? You don’t, and this isn’t even a rose.
What are the requirements for the USDA program?
So USDA has a few interesting requirements First of all, you’ll need to have at least a 580 credit score Some lenders require a 620 credit score.
Your household income has to be under the county maximum Like a lot of down payment assistance programs. This is based on family size So 1 to 4 is one category and then 5 and above is a higher threshold for qualifying
What’s unique about this one is the home has to be within a designated area.
So, Typically what that means is.
NOT within a metropolitan area So within our area here (Riverside county) Our local cities around her don’t qualify But we only need to go 10 miles away to where there’s an open area where there’s Several homes that qualify.
USDA stands for United States Dept of Agriculture But it’s NOT a farm loan.
Specifically, they don’t finance this program for farms in Denton.
It has to be a Single Family home in the Denton area, without a barn structure on the property.
Then it also has some home price limitations.
The Threshold is a little bit lower than say an FHA loan for the loan limits.
Ok, and how does this program differ from other Down payment programs?
So it’s different because it’s not really a down payment program but it allows financing up to a 100% of the purchase price And it’s interesting because you can actually use this program with 1 or 2 of the other programs.
If you need closing cost assistance But, what’s unique it’s a 100% Financing so you don’t need a 2nd or a 3rd lien on the property.
Your interest rates are typically lower than if you combine it with a down payment assistance programs and you don’t have to repay any down payment assistance.
It has a monthly factor It’s like mortgage insurance upfront It’s financed at a monthly component.
Much less than FHA So if you can qualify for this program It’s better than FHA And As I mentioned, rates and payments Are typically lower on this program So USDA is really a great program.
And on average How much does the home buyer have to come in with out-of-pocket?
So Again, we are financing the whole loan Purchase price up to 100% So the only thing remaining is then the closing costs Typically, plan on around 3% of the purchase price for funds to close.
The question there then becomes, Well, Where does that come from? Typically, we ask the seller to cover those costs And if we can get the seller to cover 3% Then, the buyer may only need to come in with an earnest money deposit.
And they may even get most or all of that back.
If the seller is covering all the fees.
One unique feature about USDA Versus all other loans is that if the home appraises for more than the purchase price.
We can finance the closing costs up to that appraised amount So, no other loan I know that we can actually finance the closing costs.
What type of home buyer is this program ideal for?
So certainly those that don’t have access to money for a down payment Anyone that wants to live that doesn’t have to live within a metropolitan area because, again, the house has to be in an area that is not in a high densely populated area.
It’s also suited well for people who have some credit issues and anybody that qualifies for this program would definitely be better served than going FHA so those type of people.
And besides the Area restrictions are their any other property restrictions? So property restrictions are going to be similar to FHA They’ll do manufactured homes.
They’ll do homes with Casitas So no real other restrictions.
Just if it conforms to the FHA guides then it should qualify for USDA There’s a couple little quirky things that you don’t run into very often like you can’t actually have a barn on the property It definitely can’t be for agricultural purposes It has to be for residential purposes.
USDA Loan Denton – Do You Pre-Qualify?
If the elevator tries to bring you down, gocrazy.
Punch a higher floor.
This is Dan on your inside team at Growella.
It's Monday, July 9, 2018.
It's today's The Mortgage Minute-and-a-Half.
People be like put me in work work work workwork work.
And employers obliged.
Friday, on the ninth anniversary of the endof last decade's recession, the Bureau of Labor Statistics reports that two-hundredthirteen thousand people entered the U.
workforce last month and that's a positivesignal even though not everyone re-entering the force has found an actual job.
Just the act of looking for jobs suggestsconfidence among U.
workers, and confidence leads to consumption which drives the domesticeconomy forward.
The jobs report also showed U.
worker hourlywage growth to be on the downswing, a data point which gave mortgage rates a quick Fridayreprieve.
Slowing wages reduce the pressure of economicinflation and when the pressures of inflation drop, mortgage rates often do, too.
So, take a look at today's live rates andget yourself a quote.
Rates are holding near the lowest in six weeks.
Today's mortgage rates are in the dirt dirtdirt dirt dirt dirt.
Interest rates for FHA loans, VA loans, conforming,USDA, and jumbo -- everything's up to kick off the week.
The rates you get from a lender are customizedand more than a dozen factors go into your quote.
Whether you go fixed or ARM, full fee or zerocost, even your choice of lenders affects the rate you get so talk to two or more lendersand find your preferred combination of rates, fees, and service.
No matter how far you push the envelope, it'llstill be stationary.
And no matter how matter how many times youhear you need twenty percent down to buy a home, it's still going to be not true.
You don't need twenty percent down to buya home.
And that fact makes a data point from EllieMae a little more concerning.
The mortgage software firm asked more thanthree thousand renters: "What's stopping you from buying a home" and the overwhelming answerwas "I haven't saved enough for a down payment".
Of all things, saving for a down payment shouldnot be the thing that stops you from buying.
After all, there are seven government-backedmortgage programs that let you make down payments of less than five percent -- some don't evenrequire a down payment at all.
HomeReady, HomePossible, HomePath, FHA loans,USDA loans, VA loan, Conventional 97.
Then, there are local government programsthat give money to buyers for buying in particular areas.
And it's there, if you want it.
So, don't get hung up on the twenty percentdown thing if you want to buy a place.
Lenders don't care so much what you put down.
They just want to know you can make your monthlypayments.
So, talk to a lender and find out what's possible.
You can't know until you ask.
Growella does timely and relevant mortgagenews three times weekly and you can visit the site at Growella dot com for more excellentmortgage and real estate news.
Go on and click the like button.
What's blue and not heavy at all.
USDA Home Loan Explained - $0 Down USDA Program Breakdown with Jason and Nikki
- Hey guys, Austin Schneider here and today we're gonnatalk about USDA loans.
So USDA loans are a government program meant to promote homeownership in rural areas.
Typically the costs aresignificantly lower.
You get into home ownership with this.
Zero percent down, mortgage insurance is significantly less than your FHA loans andyour interest rates too are typically lower than yourtraditional mortgage rates.
They're available fromany mortgage lender.
So you don't have to gothrough a special entity or even the government to get approved.
There are income limitson this type of loan.
So you need to make sure you qualify because they are meantfor the medium earners.
And the loans are geographically based.
So the home that you're purchasing must be in an eligible area but most suburban areas are.
And if you're a home buyer, if you're thinking about buying a home I encourage you tocheck this one out first before you jump right into conventional because you may be surprised.
For more on this topic,for more about USDA loans click the link in the description.
Thanks so much for watching and we'll see you on the next video.