USDA Borrower Advantages
USDA Program Features
USDA Property Eligibility:
You might be surprised to find what properties are located in a USDA tract!
To find a qualified property and access the USDA website click the following link: http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do
- No down payment required. 100% financing available.
- Not limited to First Time Homebuyers! This program is also available for the move up homebuyer.
- More affordable than FHA.
USDA Program Features
- Guarantee Fee applies: may be financed and added to the loan amount.
- Flexible credit guidelines and 640 Credit Score.
- Qualifying ratios are 29% for housing costs and 41% for total debt. Lenders may request an exception to exceed these ratios when strong compensating factors are identified.
- Closing costs may be paid by seller, financed (if eligible), paid by lender credit, or paid by borrower.
- Flips over 20% acquisitions are allowed.
USDA Property Eligibility:
You might be surprised to find what properties are located in a USDA tract!
To find a qualified property and access the USDA website click the following link: http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do
USDA Pilot Program - REFINANCE
- Minimum 640 Credit
- 12 mos. housing history current loan - Refinance Only, Not applicable to Purchases *1st Time Homebuyers under purchase program*
- Income verified, but NO Debt To Income calculation
- SFR, PUD, attached/detached condos
- (Condos must be FNMA, FHA or VA approved)
- 2055 Conventional appraisal required
- Interest/closing/prepaids can be included
- (Orig. fee not to exceed 1%)
USDA Program Features:
100% Loan-to-Value based on Appraised Value.
Purchase Transaction: 2% upfront Guarantee Fee (may be financed). 0.40% Annual Guarantee Fee.
Closing costs: can be financed into loan or can be paid through premium pricing provided the appraised value is higher than the purchase price. The maximum closing costs that can be financed is the difference between the purchase price and the appraised value plus USDA guarantee fee.
Example:
Purchase Price: $250,000
Appraised Value: $258.000
Borrowers want to finance $8,000 in closing costs in the loan since the appraisal is higher that the purchase price. In addition, they can finance USDA's guarantee fee.
Loan amount $258,000 divided by .98 = total loan amount of $263,265.30.
Subtract total loan amount $263,265.30 from loan amount $258,000 = $5,265.30 USDA Guarantee Fee.
Total Loan Amount $263,265 X 2% = $5,265.30 USDA Guarantee Fee.
Loan Amounts up to $417,000 with a 640 score
Borrowers must meet maximum household income requirements and property must be in an eligible rural area.
To find a qualified property and access the USDA website click the following link: http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do
100% Loan-to-Value based on Appraised Value.
Purchase Transaction: 2% upfront Guarantee Fee (may be financed). 0.40% Annual Guarantee Fee.
Closing costs: can be financed into loan or can be paid through premium pricing provided the appraised value is higher than the purchase price. The maximum closing costs that can be financed is the difference between the purchase price and the appraised value plus USDA guarantee fee.
Example:
Purchase Price: $250,000
Appraised Value: $258.000
Borrowers want to finance $8,000 in closing costs in the loan since the appraisal is higher that the purchase price. In addition, they can finance USDA's guarantee fee.
Loan amount $258,000 divided by .98 = total loan amount of $263,265.30.
Subtract total loan amount $263,265.30 from loan amount $258,000 = $5,265.30 USDA Guarantee Fee.
Total Loan Amount $263,265 X 2% = $5,265.30 USDA Guarantee Fee.
Loan Amounts up to $417,000 with a 640 score
Borrowers must meet maximum household income requirements and property must be in an eligible rural area.
To find a qualified property and access the USDA website click the following link: http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do