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USDA Rural Development Single Family Housing

Guaranteed Loan Program

 The mission of USDA Rural Development’s Single Family Housing Guaranteed Loan Program is to assist low to moderate income rural homebuyers achieve their dream of homeownership!

Applicants must purchase a home within the eligible rural areas, and have a household income that does not exceed the established limits where the home is located. Additional Guaranteed Loan Features include but are not limited to:

·         100% financing, no down payment is required. The loan amount may not exceed 100% of the appraised value, plus the guarantee fee may be included.

·         Guarantee Fee applies: may be rolled into the loan amount.

·         Flexible credit guidelines. Non-traditional credit histories may be accepted.

·         Fixed 30 year interest rates apply. Lenders and applicants agree upon interest rate.

·         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.

·         No maximum purchase price. Qualifying ratios and the applicant’s stable and dependable income will determine home affordability.

·         Eligible property types include existing homes, new construction, modular homes, Planned Unit Developments (PUD’s), eligible condominiums and new manufactured homes.

·         Eligible closing costs and lender fees may be included in the loan or paid by the applicant.

·         Gift/Grant Funds/Mortgage Credit Certificates (MCC’s)/Seller Concessions are allowed.

·         Eligible repairs and improvements may be included in the loan.

·         Applicants apply with an approved lender of their choice.

·         Not limited to first time homebuyers.

USDA Streamline Refinance Program

The USDA Streamline Refinance is a pilot refinance program for homeowners with a USDA home loan. The program was made public in 2012.

The streamlined USDA program meant to mirror other successful streamlined programs such as the FHA Streamline Refinance from the FHA, the VA Streamline Refinance (IRRRL) from the Department of Veterans Affairs, and the aforementioned HARP program from Fannie Mae and Freddie Mac.

With the USDA Streamline Refinance, loan qualifying hurdles are low, underwriting is fast, and closings are typically scheduled within 3 weeks of initial application.

USDA loans close quickly because the agency enforces minimal eligibility standards :

1.    The home you're refinancing must be your primary residence

2.    The home you're refinancing must be mortgaged via a USDA Direct Home Loan or a USDA Guaranteed Home Loan

3.    Prior to applying, you must have made 12 consecutive on-time payments

And, that's it. With the USDA Streamline Refinance, there are no credit report requirements, no home appraisal requirements, and no property inspection requirements.

All credit scores are accepted into the USDA Streamline Refinance program, and a home's loan-to-value is not a consideration. Underwater homeowners can use the program as easily as a homeowner with 20% equity can.

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