The amount of loan options out there for home buyers is beneficial for different buying circumstances. If you’re exploring home-buying options in rural or suburban areas, you’ve probably come across USDA loans and wondered how they could benefit you. Well, you’re in luck! Our guide to USDA loans is designed to help you understand rural financing, a fantastic resource for potential homeowners who are looking at properties outside major urban centers.
At Edge Mortgage Inc. we make the loan process simple. Our mission is to set a high standard in the mortgage industry. Buying a home or refinancing your existing mortgage should not be expensive or difficult. Our team is committed to quality customer service by putting you first and will listen to and answer all of your questions. We provide our clients with the lowest interest rate possible and don’t have any hidden fees. Whether you prefer to do everything electronically or meet face to face, we will be there every step of the way.
We understand that everyone’s financial situation is unique, and we’re here to help you find the perfect loan to match your needs. You’ll appreciate the expertise, professionalism, and personal attention we bring to each of our clients, ensuring that your loan process is not only successful but also a positive experience. Since you’re interested in a home with a bit more space around it, let’s explore our guide to USDA loans together to see how they could be the right choice for you.
What are USDA Loans?
USDA loans are government-backed loans that are being provided by the United States Department of Agriculture. They are a part of a bigger program that was created to enhance the quality of life in America’s rural areas by providing low to moderate-income households the chance to own adequate, safe, and sanitary dwellings as their primary residence. But, a lot of people don’t know they exist. So it’s important to know all there is to know about the guide to USDA loans.
Benefits of USDA Loans
One of the most appealing aspects of USDA loans is that they require no down payment. Yes, you read that right—zero down to buy your home, which is a rarity in the mortgage landscape today. They also offer competitive interest rates and lower insurance costs compared to other loan types, making them an affordable option for many buyers.
Eligibility Requirements
Eligibility for a USDA loan is based on several factors:
- Income limits: Your household income should not exceed 115% of the median income of the area.
- Credit score requirements: A credit score of 640 or higher is typically required, though exceptions can be made based on a lender’s assessment of your credit history.
- Property eligibility: The home must be located in an eligible rural area as defined by the USDA. You can use their online tool to see if a property qualifies.
Types of USDA Loans
- Direct Loans: These are for very low- and low-income applicants. The terms can extend to 33/38 years, and the interest rates can be as low as 1%, depending on subsidy eligibility.
- Guaranteed Loans: These are the most common type of USDA loans, issued by private lenders but backed by the USDA. This guarantee allows lenders to offer favorable terms.
- Home Improvement Loans and Grants: These are for homeowners who want to improve or modernize their homes and are also available to elderly low-income homeowners as grants.
The Application Process
Applying for a USDA loan involves a few key steps:
- Check Eligibility: Ensure both your income level and the property location meet USDA guidelines.
- Find a Lender: Look for lenders that offer USDA loans and compare their terms like Edge Mortgage Inc. We serve all of Colorado, Wyoming, Ohio, and Nebraska.
- Gather Documentation: You’ll need to provide documents like proof of income, tax returns, and employment verification.
- Complete the Application: Fill out the lender’s application form and submit it with all required documentation.
- Approval Process: After submission, the application will be processed and inspected by the lender and the USDA.
Comparing USDA Loans to Other Home Financing Options
When considering USDA loans, it’s helpful to compare them with other financing options like FHA and conventional loans:
- FHA Loans: Require a down payment (as low as 3.5%) and mandatory mortgage insurance.
- Conventional Loans: Typically require higher down payments and good credit scores but offer more flexibility on property type and location.
In conclusion, if you’re thinking about buying a home in a rural or specific suburban area, USDA loans could be a fantastic fit for you. They offer great perks, like not requiring a down payment and having lower interest rates, which really helps make owning a home more achievable and promote growth in these communities. Curious to know more about USDA loans or need some guidance with the application process? Feel free to get in touch. Above all, my team and I are ready to assist you through every step of securing the right financing for your perfect countryside retreat. Contact us today at Edge Mortgage Inc. or start your application online.
Read some of our 5-star reviews from our happy clients
“Keri did an awesome job with are purchasing of a home. She had everything in line with the loan upfront. The one thing that helped get the house is she answered her phone on the weekend and talked with the seller’s realtor. I will be using Kari on are next home buy!!” -Nick
“Absolute wonderful experience. Wouldn’t trust my home buying to anyone else after the love and care shown to my family’s home buying effort. If we ever move again I know who I’m working with!” -Alex
Edge Mortgage Inc. is your trusted guide to USDA loans
Edge Mortgage Inc. is located in Johnstown, Colorado, and serves all of Ohio, Colorado, Wyoming, and Nebraska. We offer the loan process made simple and top-notch customer service. We are your trusted Mortgage Lender and the top-rated mortgage specialist. Call us today at 970-744-0000.
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