Are you thinking of moving into a new home? Do you want to buy a new home or refinance your current mortgage? USDA home loans might be the perfect solution for you. USDA loans are government-backed loans intended for rural and suburban homebuyers who might not otherwise qualify for traditional financing. USDA loans can be used to purchase and refinance a home in an eligible rural area of the country.
USDA loans carry several benefits, such as no down payment requirement, high loan limits, competitive interest rates and lenient credit requirements. In addition, the USDA loan program is designed for borrowers with lower incomes.
The USDA direct loan program is for buyers who already own a home and wish to borrow against the equity of their current home. USDA direct loans offer below-market interest rates, no mortgage insurance, and do not require a credit check or minimum credit scores. However, borrowers must provide at least 10 percent down payment from their own funds.
The USDA Guaranteed Loan Program (Guaranteed Loan Program or FLP) is for first-time homebuyers and borrowers who are purchasing in a rural area for the first time. The FLP offers below-market interest rates and does not require a credit check or minimum credit score. However, borrowers must provide at least 3.5 percent down payment from their own funds.
The USDA Rural Development Guaranteed Housing Loan Program (Guaranteed Housing Program or GRP) is for low- and moderate-income families who wish to buy a home in an eligible rural area. The GRP offers below-market interest rates and does not require a credit check or minimum credit score. However, borrowers must provide at least 3 percent down payment from their own funds.
The USDA loan program is designed for borrowers with lower incomes. The income limits vary according to family size, and are based on the USDA’s definition of “low-income.” For a family of two, the income limits are $50,100-$99,200; for a family of three or more, the income limits are $50,100-$102,250.