100% Financing
Eligible borrowers may be eligible for a loan with 100% financing. This means you may be able to buy a home requiring no down payment.
- Closing Cost Assistance
A unique benefit of this mortgage program is if the appraised property value exceeds the sales price, the borrower has the opportunity to increase the loan amount to cover all or a portion of the closing costs.
- Fixed Affordable Interest Rates
USDA is accompanied by a fixed affordable interest rates. There can be many advantages to getting a more affordable interest rate. Manly your FICO credit score will determine how low your interest rate may be.
The better your credit score, the better chance you’ll have a lower interest rate. Your debt to income ratio will be a factor as well.
- Mortgage Insurance Calculated on Affordable Scale
Although it is required, the Mortgage Insurance is calculated on an affordable Mortgage insurance scale.
USDA assesses a 2.00% upfront mortgage insurance premium - and a 0.40% in MIP annually, paid monthly.
Here’s a look at mortgage insurance premium fees with USDA mortgages:
For purchases: 1.00% upfront fee paid at closing
For refinances: 2.00% upfront fee paid at closing
For all loans: 0.30% annual fee, based on the remaining principal balance
For example: if a homebuyer with a mortgage $100,000 loan would be required to pay a $2,000 upfront mortgage insurance premium payment at closing, plus a monthly $33.33 payment for mortgage insurance.
- Flexible Credit Underwriting
USDA offers flexible credit underwriting requirements for low to moderate wage earners. Your credit score will determine if you’re eligible for any loan. USDA considers it’s financing based on financial situation for lower to moderate-income families. This can create beneficial opportunities for first time homebuyers.
To learn more about Rural Development Loan qualifications and eligibility, fill out a USDA Loan Application. Or if you need more information, visit our Rural Development Loan Resource Section for quick answers to common questions, or call the home loan experts at 1-239-645-4580.