USDA Rural Development:  Mortgage Guidelines

Down payment

Credit

Income

Ratios

Loan Limits

Interest Rates

Buyer Eligibility

Property Eligibility

Underwriting

Loan Process

Funding Fee

For Sale By Owner Advantage

USDA Direct Loan

Good Grief How long does it take

Refinancing is not a good idea.

USDA Rural Development Guaranteed  Mortgage Guidelines

This web site will explain the USDA Rural Development guaranteed mortgage guidelines.  This is a 100%  loan to value (100% LTV), government guaranteed home loan that is geared to help moderate income families.

As a side note, USDA also offers a USDA Rural Development Direct Mortgage for people with low to very-low income. The guidelines for the Direct loan are quite different so you should visit this site:  USDA Rural Development Direct Loan 

USDA Guaranteed Loan

The major benefits are:

• 100% mortgage LTV based on the APPRAISED value
• Zero down payment and no minimum contribution required.
• No limit on seller concessions or gift
• No mortgage insurance required
• No reserves required
• 30 year fixed rate only
• Lenders must be USDA approved.
• Low interest rates
• Flexible Credit Guidelines
• Property must be in a rural eligible location

In the not so distant past few people, including real estate agents and loan officers, were aware of this government program.  Real Estate Agents, Lenders, and For Sale By Owners should use this 100 percent loan to the advantage of the buyer and the seller.

Not every home or buyer will qualify for this loan. If they do qualify they will be getting one of the top mortgages, with the lowest interest rates on the market today.

Here is a very short video that covers the basic qualifying factors.  You should still review the rest of  this site for more details:

The only disparaging issue is the Government operates on a fiscal year budget that ends on September 30th of every year.  It can take a month or much more after September 30th for the new budget to be allocated.  It is also possible to deplete the budget prior to Sept 30th, as it has in the past.  Your loan could be held in limbo, with out closing, if it falls into this time frame.  

Lenders usually have the option to close the loan without budget if they are issued a Loan Note Guarantee - "Subject to Fund Allocation".  Most lenders will not close with a "subject to" LNG.  If this happens it becomes a waiting game.

We are not part of  USDA Rural Development and we are not a mortgage lender/broker.  We do not collect your information or sell leads.  We put out this information because we believe in educating buyers so they don't get ripped off in the market.

We have several other sites that cover the mortgage underwriting guidelines for FHA, VA, and Conventional Mortgages as well.  The other websites we operate are listed at the bottom of this page.

As a buyer you should familiarize yourself with the guidelines of each mortgage product.  Then you will know what program best meets your needs BEFORE you shop for a home loan.  The more you know and understand the less likely it is that you will fall prey to people with a different agenda than your best interest.

If you have questions you can email us and we will do our best to help you find the answers.