USDA Home Loans: What You Need To Know
There are many different ways to buy a house, and most people who make a purchase of this size will need a mortgage to complete their purchase. With that in mind, though, there are several different mortgage options for buyers to consider. Among these is the USDA loan, which is not generally heard about as much as FHA or VA loans, along with standard mortgages. The USDA loan is backed by the United States Department of Agriculture, but not every person or every property will qualify. Here is what buyers need to know.
Who is Eligible for a USDA Loan?
Both single people and couples can be eligible for a USDA loan. They do not need to be veterans or part of any particular group of people. They do, however, need to have specific income levels and choose a qualifying property. If they do those things and meet those requirements, they can be eligible for a USDA loan.
This is not based on age, gender, race, type of work performed, education, or anything else, and only on the property and the income levels of the people who want to buy a home. Buyers also need to be without good housing now, and show that they have a credit history. This is still a mortgage, and people must qualify – but the rules for qualification may be easier than for other mortgage programs.
What Are the Income Guidelines?
The income guidelines vary based on the number of people in the household and the area of the country. This is due to the fact that some areas of the country are simply more expensive than others, and a particular level of income would not go as far there as it would in other places. Additionally, how many people are in the household matters, because two people can live on a smaller income than a family with children. If there is a big family that wants to buy a home with a USDA loan, they can have a higher income than a smaller family who is also looking to use the program.
What Kinds of Properties Can Be Chosen?
The properties buyers can choose from have to be rural or suburban, such as communities like Gainesville. The USDA has a map of the properties that are eligible, and the home a person chooses has to be located in an eligible area on that map. If it is too urban, buyers cannot use the USDA to purchase it. Before deciding on a property, any buyer who plans to use the USDA program will want to work with a real estate agent and a mortgage broker in order to be sure they are looking at eligible properties. That way they do not fall in love with a property and then find out that they cannot buy it because it is not in a location that is supported by the USDA loan program.
The Perks of a USDA Loan
Among the largest perks of a USDA loan is the ability for a lower income buyer to get into a house that they will love in a place they enjoy, and where they feel at home. These loans can be used for large and small houses, and for farms and other rural and suburban properties. Another perk of a USDA loan is the way it allows for no money down, so buyers do not need to come up with large down payments to get into their new homes. That can help more people have the joy of home ownership.