Are you in the process of buying a home but just not sure how you plan get funding? Or maybe you’re a first time home buyer looking for potential options to purchase without a significant down payment? Maybe a USDA is the right choice for you to fund the purchase of your new home.
What Is A USDA Loan?
The U.S. Department of Agriculture provides mortgage programs that help those looking to secure a home loan without a down payment in specific areas that meet the proper requirements. If you are considering purchasing a home and are not sure whether or not the home or area you have in mind would qualify, you can reach out to Family First Mortgage for help with researching properties what could be guaranteed by the USDA.
There are two types of loans that are provided by the USDA. The first is a loan guarantee, this is a mortgage issued by a local lender but guaranteed by the USDA. The second type of loan that you can secure through the USDA is a direct loan which are provided for low income applicants which vary by location.
How To Qualify
There are certain requirements that need to be met in order to secure a loan guaranteed by the USDA. For example, the home needs to be owner-occupied as well as the primary residence of the borrower. Other requirements that are needed for a USDA loan are US citizenship, monthly payment, good credit history, and a credit score of at least 680.
Another reason the USDA can be a great options for homebuyers is they provide funding for those with the greatest need. For example, if a family has tried to fund the purchase of a home in the traditional manner without success or has an income that is below the low income level for the area, they will be reviewed for a USDA loan with priority.
What’s The Catch?
You might be asking yourself, why would the government fund these loans without a down payment when you typically need at least a certain percentage of the property to qualify? The reason behind that is to help families that are low income in rural areas secure funds to purchase a home. Providing the chance to those that may not be able to buy a home in these areas creates a sense of community and establishes a better lifestyle that will continue to flourish as time passes and others begin to invest into the community as well.
Reach Out Today!
If you are thinking about applying for a USDA loan and have questions, we would love to help guide you through the process. Don’t hesitate to reach out to Family First Mortgage in Lafayette, LA today!