Qualifying For USDA Loans
Flexible underwriting and approval guidelines to help promote home ownership in rural communities … read more
Refinance Your USDA Loan
Obtain a lower interest rate and mortgage payment and/or refinance into a more stable loan program. … read more
USDA Loan Purchase Program
100% financing available with the government insured USDA Rural Home Loan Program. … read more
- About USDA Rural Loans
- Benefits of USDA Mortgages
- USDA Mortgage Eligibility
- Buying With A USDA Loan
- Streamline - USDA Refinance
- Common USDA Questions
- USDA Program History
Missouri USDA Rural Home Loans
Reasons to Consider a USDA Purchase:
- Very Competitive fixed interest rates
- Zero money down
- Affordable loan terms at 30 years
There are many great benefits for both lenders and borrowers. Loans are guaranteed up to 90% of the original loan, making it easier for lenders to lend to more individuals. There is also 100% financing with no down payment required.
Click Here to check if you are eligible for the USDA Home Loan Program.
Benefits Of Missouri USDA Mortgages
There are many great benefits as well to a USDA Mortgage Loan, there are no credit or income verification since the loan is insured by the US Department of Agriculture, with this being so the borrowers have an advantage over other conventional loan options. The USDA home loan program offers:
- Zero Down Payment
- Low closing costs
- Funds to be used on repairs(renovations)
- Lower mortgage bills
- Up to 100% Financing
- No PMI
- Energy Efficient Homes (lower utility bills)
With a lower interest rate and lower monthly mortgage bills, USDA borrowers can apply funds saved on other essential household expenses.
The USDA Rural Home Loan Program gives borrowers the ability to finance closing costs into the loan itself and the underwriting guidelines are more relaxed and credit ratings are not as essential.
The USDA Guaranteed Home Loan is the only federal homeownership program that actually is able to assist low-income households in rural areas.
USDA Loans are pretty similar to conventional loans or FHA loans, for they do not have complex repayment schedules and the loans are even extended out for 30 years. The USDA guaranteed home loan is only intended for homes in rural areas of the U.S.
USDA Mortgage Loan Eligibility
In order to be eligible, the home must be located in a designated rural area.
A couple of the main eligibility requirements are as listed below:
- An adequate and steady income of up to 115% of the adjusted median income (AMI).
- Decent credit history
- Unable to qualify for a conventional mortgage loan
- No delinquencies on any tax or non-tax debts and there can not be any judgement liens against the applicant's property for any debt owed to the government
The Rural Development has a method of determining a household's income by using two formulas.
Two Step Formula:
1.) The burden of principal, interest, taxes, and insurance (PITI) must be 29% less than the gross monthly income.
2.) The total monthly debts must be 41% or less than the gross monthly income.
The USDA is not limited to first-time homebuyers. The loans were set up to assist eligible homebuyers despite the fact that they own a home before or not.
Buying a Home With a USDA Mortgage
USDA guaranteed Loans offer competitive fixed rates. They do not offer any adjustable rates of any kind. Making it so that your monthly mortgage payments will never increase.
The only fee associated with the USDA rural housing program is a small one-time funding fee, allowing for borrowers to pay off their mortgage a lot faster rather than spend extra funds on fees.
There are several eligible property types to be considered for purchasing with a USDA mortgage.
- A new or existing single-family home
- Modular homes
- Approved condominiums
- A new manufactured home
Purchase eligible home types with a USDA Mortgage:
there is no set minimum credit score required to qualify for a USDA Rural Development Loan, but you must be able to show proof of willingness and the ability to repay any mortgage obligations.
For those living in a qualifying suburban town (generally with a population of less than 20,000), a USDA home loan may be the perfect option if purchasing a home. The government established this program to encourage growth in the nation's smaller communities, and today it is one of today's existing no money down loans.
Streamline Your USDA Home
USDA has been supporting mortgage financing for thousands of rural families each year, and even better they are now taking extra steps in further Streamline its USDA-to-USDA refinancing program. This program is designed to provide those who currently have loans that are insured by the Department of Agriculture with a low-cost, streamlined process for refinancing into today's low rates.
The basic requirements are:
- Current mortgage for refinance must already be a USDA loan.
- There must be a financial benefit resulting from the refinance.
- Borrowers must be current on their present mortgage payments.
The USDA Streamline Refinance is designed to help lower the interest rate on a current USDA mortgage and is only available in a fixed rate. If you financed your home through a USDA home purchase program then you would be considered eligible for a USDA home streamline refinance.
There are many benefits with the USDA Streamline Refinance, below are a few listed:
- Low fixed monthly payments
- Low to no closing costs for streamlines
- Low monthly mortgage insurance
- No pre-payment penalty
- Low USDA interest rates
USDA lenders may offer a streamlined refinance without obtaining a new appraisal. All other costs, documentation, and underwriting requirements must remain consistent with a purchase guarantee,unless otherwise noted.
Our network of mortgage professionals ((incitycommastate)) can help you take advantage of the best loan rates available, meeting your needs. Our primary interest is your goals and getting you the best loan rates available. We make the process simple just contact us today!
Common USDA Refinance Questions
Can i refinance with a USDA Streamline if I have a Conventional mortgage?
The USDA Streamline Refinance can only be used on a current USDA mortgage or a designated rural area.
I have a USDA mortgage but am renting out the property to a relative, can i still do a Streamline with USDA?
All borrowers on the mortgage must be currently occupying the property in order to qualify for the USDA Streamline Refinance Program.
When does the pilot program expire?
The pilot program is expected to expire on February 28, 2014. There may be a possibility for extension if it shows to be successful.
Is it possible for me to borrow additional funds for home improvements?
No additional funds may be received from the Streamline Refinance with USDA for any reasons.
History on USDA Mortgages
The USDA Home Loan Program is a part of President Obama's financial plan to help responsible homeowners. President Obama is focused on helping responsible borrowers along with supporting the housing market recovery. The President believes that responsible homeowners should not have to sit and wait for a the market in order to get relief when there are measures that can be taken by allowing homeowners to save thousands of dollars with refinancing at today's low rates.
USDA has allotted a designate amount of money for funding of USDA mortgage loans in each USDA 'qualifying area'. Homeowners may qualify to use available funds to refinance their current USDA mortgages. As with most loan programs, there are certain qualifications, eligible guidelines, and restrictions that may apply to the USDA loan program.