I know, I know, that sounds like a headline from the crazy boom days, but it’s real and has been for a long time. It’s been called Rural Housing and USDA financing (when I see USDA I think of a big t-bone steak!).
But don’t be fooled by it’s “rural” name… there are many beautiful subdivisions that qualify!
Eric in my husband’s mortgage office just closed a beautiful townhouse overlooking a golf course and IT went USDA financing!
Here’s the quick skinny:Â 620 minimum score, no monthly MI (but there is up front “guarantee fee” of 2% that can be rolled into the loan), they’ll actually finance up to 102% of APRAISED value (not purchase price) so it could actually be the purchase price plus all closing costs if the deal is structured right!
Interest rates are just a smidge higher than an FHA rate, but without that pesky MI or 3.5% down!
Imagine getting your client into a house for nothing down AND they get $8,000 back! Whew!
Many MLS systems have a “financing available” field, so check if the property is eligible and then update your listing!
Here’s where to check:Â USDA Property Eligibility Link If the property is listed as eligible, you’re good to go!
In fact, go check all of your listings right now and start marketing the eligible ones with 102% financing! I’ve even seen it marketed on 1/2 million dollar loans! (there is no official “loan limit” but the borrower needs to be UNDER a certain income level… so it would be hard for someone to qualify in this instance)
But don’t be discouraged… the income limits are much higher than you might expect!
Talk to a knowledgeable mortgage broker right away. (In Florida you can call my husband Tim or Eric in his office at 407-831-2277)
Hope that helps!
Andy
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