Dec 14

12

Can you qualify for a USDA home loan when the property is located on a private road?

So, how do you qualify for a USDA home loan when the property is located on a private road?

When working in rural communities, this is a common question as you can imagine and in today’s video tip we will cover the USDA qualifying guidelines when dealing with private roads.

USDA Guidelines require that streets and roads must be hard surfaced or all-weather surfaced.  They define an “all-weather surface as a road surface over which emergency and the area’s typical passenger vehicles can pass at all times.”

A very key point that has been clarified in the new USDA 3555 guidelines states “A publicly maintained road is automatically assumed to meet this requirement.”

Another important point of clarification is that USDA guidelines do not require a private road maintenance agreement.

qualify for a USDA home loan when the property is located on a private road

Now that we have defined the guidelines, let’s walk through the steps on how to qualify for a USDA loan with a property located on a private road:

Step 1.  It is always a good idea to confirm with your local county roads & bridges department the exact type of road classification.  Just because it may be a dirt road, don’t assume that it is also considered private.  Many counties have different classifications of road types and it is always best to make the call and double check.

Step 2. Once determined that the road or street is private the following USDA private road guidelines are required:

  1. Private streets must have a permanently recorded easement, or
  2. Be owned and maintained by a Homeowner’s Association (HOA)

If a HOA is responsible for maintaining streets and roads, it must meet the criteria set forth by Fannie Mae, Freddie Mac, the U.S. Department of Housing and Urban Development (HUD), or U.S. Department of Veterans Affairs (VA).

qualify for a USDA home loan when the property is located on a private road

All recorded easements must be reviewed and approved prior to closing.  Your title company or attorney handling the closing can help with easement questions. For further understanding, here is a definition of an Easement from Wikipedia.

In summary, do not always assume just by the road type that it may be a private road.  Always check with the county where the property is located to get proper street classification on whether it is actually public or private.

As we all know, different factors can evolve on each transaction, but this will give you a great start to staying organized with the steps needed to qualify for a USDA loan when the home is located on a private road.

Qualifying for a USDA home loan can be both difficult and overwhelming, but when you work with a lender that specializes and understands the USDA loan process, it is a match that can open the door to homeownership.

USDA Blueprint for Success

If you are looking to purchase a home within the next 6 months download your free USDA Blueprint for Success! This is a great educational resource for both buyers and Realtors.

For more immediate scenarios, click here to get pre-qualified for a USDA mortgage today!

So, keep us in mind for your next pre-qualification or if you have a current transaction experiencing financing difficulty and need an expert opinion.

Just call or email to discuss your scenario and let us show you the “Metroplex” difference!

Questions? Contact Us Here.

Toll Free: (800) 806 – 9836 Ext. 280

And don't forget, we are known for returning calls, replying to your emails, and responding to voice mails.

Please remember that mortgage requirements are constantly changing so stay current and up to date by subscribing on the right for future video tips.

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Posted in USDA FAQs

Dec 14

5

Can you qualify for a USDA loan with medical collections?

Can you qualify for a USDA loan with medical conditions, and does it make a difference what type of collection account it is?

qualify for a USDA loan with medical collections

As a starting point, whether it is a medical collection or otherwise, this type of activity is considered negative and impacts credit scores. With that being said, there can be flexibility with USDA qualifying when medical collections are listed on the credit report.

Under prior USDA guidelines, any open collection account was considered negative credit regardless of type, amount, or the rest of the applicant’s credit profile. Now under the new 3555 guidelines effective 12/1/14, the lender will consider the following during the underwriting process (regardless of automated or manual review):

1) Determine if the total outstanding balance of all collections accounts is equal to or greater than $2,000.

2) Remove all medical collections and charge-off accounts from the total balance. Medical collections and charge-off accounts must be clearly identifiable on the credit report.

3) If the remaining outstanding balance of collection accounts are equal to or greater than $2,000, any of the following actions will apply:

a. Payment in full of all collection accounts at or prior to closing.
b. Payment arrangements are made with each creditor for each collection account remaining outstanding. This must be documented by either a letter from the creditor or evidence on the credit report which validate the payment arrangements.
c. In the absence of a payment arrangement, the lender will utilize in the debt-to-income ratio a calculated monthly payment. For each collection utilize 5% of the outstanding balance to represent the monthly payment.

Simply paying a collection account does not immediately justify intent for good credit, and requiring a payment may cause the depletion of liquid assets that instead could be utilized for reserves after closing.

qualify for a USDA loan with medical collections

Remember that each potential applicant’s qualifying will be looked at differently which will determine the reasons for any open collections and if they are considered one time occurrences that are not likely to recur or if they represent a trend of unwillingness or inability to repay debts.

In summary, the new USDA guidelines provide clarification and additional flexibility when attempting to qualify for a USDA loan with medical collection accounts.

Qualifying for a USDA home loan can be both difficult and overwhelming, but when you work with a lender that specializes and understands the USDA loan process, it is a match that can open the door to homeownership.

USDA Blueprint for Success

If you are looking to purchase a home within the next 6 months download your free USDA Blueprint for Success! This is a great educational resource for both buyers and Realtors.

For more immediate scenarios, click here to get pre-qualified for a USDA mortgage today!

So, keep us in mind for your next pre-qualification or if you have a current transaction experiencing financing difficulty and need an expert opinion.

Just call or email to discuss your scenario and let us show you the “Metroplex” difference!

Questions? Contact Us Here.

Toll Free: (800) 806 – 9836 Ext. 280

And don't forget, we are known for returning calls, replying to your emails, and responding to voice mails.

Please remember that mortgage requirements are constantly changing so stay current and up to date by subscribing on the right for future video tips.

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Posted in Florida USDA loans, USDA Credit Qualifying, USDA Underwriting Guidelines

Nov 14

26

Happy Thanksgiving From Metroplex!

What is the minimum credit score for USDA loans?

Greetings from the Metroplex team! We just wanted to reach out and wish everyone a Happy Thanksgiving, and to share a few quick highlights on the upcoming USDA Guideline changes on 12/1/2014.

  1. USDA will now accept properties with in ground swimming pools and no longer have value restrictions applied!
  2. USDA has eliminating their 30% site value requirement, and 
  3. USDA loans for properties with flood zones, we no longer have to determine the base flood elevation for existing properties. The borrower only has to obtain eligible flood insurance.

What is the minimum credit score for USDA loans?

In order to help with some recent USDA updates, here are 3 of our most watched videos recently….

How Can The USDA Guideline Changes Help You Attract More Buyers?”

taking place on Dec. 4.During this webinar I will review the USDA guideline changes and also discuss how you can use them to your advantage when marketing the USDA home loan program to potential homebuyers.

What is the minimum credit score for USDA loans?

To register, click here.

Until then, if you would like to know more about the USDA updates, or USDA home loans in general, be sure to check out a few of our more popular blogs on the topic.

1.)  How Do You Calculate A USDA Monthly Payment?

This blog was created in response to one of the most common questions we receive, and will walk you through using our new USDA Loan Calculator!

2.)  Are You Prepared For The Upcoming USDA Guideline Changes On 12/1/14?

This blog goes into more detail on what you can expect after December 1, 2014 from the USDA and their guideline changes. We recommend reading this so you can have a basic understanding of how the changes will influence and impact USDA homebuyers.

3.)  Can You Get A USDA Loan While In Consumer Credit Counseling?

Often times, homebuyers will seek out USDA loans due to their flexible nature when it comes to credit scores. This is a great blog to read if you know any homebuyers who may be struggling with their credit, or who are in credit counseling.

4.)  What Are The Benefits Of A USDA Rural Home Loan?

This video is an oldie, but still a goodie, and probably our most popular blog. It details the benefits of applying for a USDA Rural Home Loan, and though guidelines are changing, many original benefits still apply.

Before we say goodbye, we have one more small tip:

What is the minimum credit score for USDA loans?

Don’t forget to add sugar to your pumpkin pie recipe! It’s critical for the success of any family gathering!

Again, we hope you all have a safe and happy Thanksgiving, and will see you right here for the next tip of the week!

Qualifying for a USDA home loan can be both difficult and overwhelming, but when you work with a lender that specializes and understands the USDA loan process, it is a match that can open the door to homeownership.

USDA Blueprint for Success

If you are looking to purchase a home within the next 6 months download your free USDA Blueprint for Success! This is a great educational resource for both buyers and Realtors.

For more immediate scenarios, click here to get pre-qualified for a USDA mortgage today!

So, keep us in mind for your next pre-qualification or if you have a current transaction experiencing financing difficulty and need an expert opinion.

Just call or email to discuss your scenario and let us show you the “Metroplex” difference!

Questions? Contact Us Here.

Toll Free: (800) 806 – 9836 Ext. 280

And don't forget, we are known for returning calls, replying to your emails, and responding to voice mails.

Please remember that mortgage requirements are constantly changing so stay current and up to date by subscribing on the right for future video tips.

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Posted in USDA FAQs

Nov 14

21

How do you calculate a USDA monthly payment?

Have you ever wanted to get an estimate of your USDA monthly payments?

USDA monthly payments
This is a common question that we receive, and today’s video tip will cover how you can calculate a USDA monthly payment and be better prepared to stay within budget when you are searching for properties.

Before we get started, don’t forget that USDA guidelines are changing on 12/1/14, so don’t forget to sign up for our free webinar on 12/4/14.  I will condense important changes into a 45 minute webinar to keep you in the know and not left behind. You can sign up for the webinar here.

So, how do you calculate a USDA monthly payment?

USDA monthly payments

When considering what your USDA monthly payment could be, it’s important to remember the following:

  1. Taxes and Insurance

These are two items that are sometimes overlooked, but are a required part of the USDA loan qualifying process when determining qualifying ratios and monthly housing expense.  If you are unsure about property tax estimates, a good tip is to check with your local property tax collector who can be a resource to help with questions.

  1. Principal and Interest

The principal part of your payment goes towards paying down the loan balance while the interest is the cost paid for borrowing your loan amount. Remember interest rates change daily and multiple factors contribute to your interest rate calculation, so please call us if you have any specific rate and payment scenario questions.

  1. The USDA Guarantee Fee and Monthly Premium

USDA home loans require 2 separate fees:

  1. The USDA Guarantee Fee is a one time charge of 2% that is financed into the final loan amount.
  2. While the USDA monthly premium is calculated  on a monthly basis and is part of your total monthly housing expense.

Based on the numbers selected, our USDA Loan Calculator automatically factors both the USDA Guarantee Fee and the monthly premium into the housing expense estimate listed.

To help you in the process, we have created a USDA payment calculator which you can access to the right of this video.  Now, let’s go over a quick example to help you get started: Type in your purchase price

  1.  USDA Guaranteed loan terms will be for 30 years
  2. Select your interest  rate (Remember that interest rates do change every day)
  3. Input the estimated annual property taxes
  4. Input the estimated annual homeowner’s insurance premium
    (Remember that property taxes  and insurance will vary from property to property)
  5. Review your total estimated USDA monthly housing expense

Please note that this calculator is for estimating purposes only, minimum credit conditions will apply on all loans, and this is not a Good Faith Estimate nor a commitment to lend.

You can forward this video and share our USDA payment calculator with anyone who may benefit and remember to always call my team with questions.

USDA Monthly Payment

Qualifying for a USDA home loan can be both difficult and overwhelming, but when you work with a lender that specializes and understands the USDA loan process, it is a match that can open the door to homeownership.

USDA Blueprint for Success

If you are looking to purchase a home within the next 6 months download your free USDA Blueprint for Success! This is a great educational resource for both buyers and Realtors.

For more immediate scenarios, click here to get pre-qualified for a USDA mortgage today!

So, keep us in mind for your next pre-qualification or if you have a current transaction experiencing financing difficulty and need an expert opinion.

Just call or email to discuss your scenario and let us show you the “Metroplex” difference!

Questions? Contact Us Here.

Toll Free: (800) 806 – 9836 Ext. 280

And don't forget, we are known for returning calls, replying to your emails, and responding to voice mails.

Please remember that mortgage requirements are constantly changing so stay current and up to date by subscribing on the right for future video tips.

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Posted in USDA Advantages, USDA Credit Qualifying, USDA FAQs

Nov 14

14

Do you know about the USDA processing time changes?

Are you ready for the USDA processing time changes?

(Don’t forget to sign up for our USDA webinar to learn about the guideline changes that are influencing processing times!)

USDA processing times

If you were unaware, the USDA offices will stop accepting new applications at the end of business on Friday November 21st through the start of business on Monday December 1st (2014).

The question is, why is this happening and how will it affect USDA processing times?

On November 6 (2014), the USDA National Office provide the following update:

“Rural Development will not be accepting any new Single Family Housing Guaranteed loan applications from the close of business on November 21, 2014 through the start of business on December 1, 2014.”

From the outside, this update appears negative for USDA processing times. However, the goal is to ultimately reduce any disruption caused during the transition to the new USDA guidelines. The following reasons were additionally noted in the announcement:

1. USDA Rural Development is not able to process applications under two regulations simultaneously. This is important because “applications underwritten using the current 1980-D regulation cannot be approved under the new 3555 regulation.”

2. Additionally, any backlogged applications in the system that are not processed by December 1st would be returned to USDA lenders in order to be re-underwritten with the new USDA 3555 guidelines. The additional time given through the end of November will be used to catch up backlogged files in order to be best prepared for December 1st.

3. It was specifically noted in their update that “One of the clear advantages to this approach is that the issuance of the conditional commitment will not have to be delayed by a large number of other applications already in the queue. By reducing the backlog we significantly accelerate the application turnaround.”

So what should you do? Find out from your lenders, brokers, and loan officers when any files which could be impacted are scheduled to be submitted to USDA. Then plan accordingly with closing dates and determine how to proceed with those specific transactions.

USDA processing times

Keep in mind, that lenders who use the GUS underwriting system WILL be able to submit applications into the system during this time. They will not however be permitted to perform a final submission of the file to USDA until December 1, 2014.

Qualifying for a USDA home loan can be both difficult and overwhelming, but when you work with a lender that specializes and understands the USDA loan process, it is a match that can open the door to homeownership.

USDA Blueprint for Success

If you are looking to purchase a home within the next 6 months download your free USDA Blueprint for Success! This is a great educational resource for both buyers and Realtors.

For more immediate scenarios, click here to get pre-qualified for a USDA mortgage today!

So, keep us in mind for your next pre-qualification or if you have a current transaction experiencing financing difficulty and need an expert opinion.

Just call or email to discuss your scenario and let us show you the “Metroplex” difference!

Questions? Contact Us Here.

Toll Free: (800) 806 – 9836 Ext. 280

And don't forget, we are known for returning calls, replying to your emails, and responding to voice mails.

Please remember that mortgage requirements are constantly changing so stay current and up to date by subscribing on the right for future video tips.

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Posted in USDA FAQs

Nov 14

7

What are the advantages of working with a USDA approved lender?

Should you work with a USDA approved lender?

USDA approved lender

USDA Rural Home loans are unique in their qualifying criteria, benefits they offer, and eligible areas that they serve.

With that being said, specific advantages can be gained by working directly with an actual USDA approved lender. Today’s video tip will shed light on what benefit this adds to a transaction.

For an applicant to obtain a USDA home loan, it may not be necessary for them to work directly with an approved lender. However, for those who are able to work directly with an actual USDA approved lender the following benefits may apply:

USDA Processing and Underwriting:

USDA Approved lenders have direct access to the Guaranteed Underwriting System (otherwise known as GUS). The GUS Automated Underwriting System is specific for USDA loans and their eligibility. When working with GUS, it provides a roadmap for eligibility, maximum debt ratios, and the all important qualifying limits that both Realtors and Homebuyers need to know when shopping for a home.
It will also determine whether the loan file is eligible for automated processing which allows for reduced documentation, or if manual underwriting will be required which is a more intensive review of the loan file.
The importance of this part of the pre-qualification and loan approval process and cannot be underscored enough.

Ability to save processing times:

While it is true that there are more steps in the USDA loan process when compared to a conventional loan, USDA approved lenders are able to work directly with USDA field offices, which eliminates a middle man in the process.

The importance of managing the loan file and holding direct communication between our office and the USDA specialists is critical for responding to their questions, supplying additional documentation, or provided a quick clarification when requested.

Prioritize USDA Loan Specific Documentation:

USDA Rural Development requires specific documents as part of their approval process. We understand the steps needed and are able to prioritize and clear the necessary items needed in order for the file to be shipped to USDA.

Then while the file is already in line waiting for USDA review, we can satisfy remaining underwriting conditions and prepare the file while we wait for the USDA commitment to be returned. When there are increased USDA processing times, this is can be a decided advantage.

USDA Program knowledge and experience:

Another great benefit that goes without saying is the amount of expert knowledge that USDA approved lenders hold. USDA loans cover a specific market and it’s incredibly important that lenders know the ins and outs of this unique loan program. USDA approved lenders understand how the program can be maximized for both consumers and the real estate community.

USDA approved lender

These were only a few of the major advantages which can be held through working directly with an actual USDA approved lender.

Qualifying for a USDA home loan can be both difficult and overwhelming, but when you work with a lender that specializes and understands the USDA loan process, it is a match that can open the door to homeownership.

USDA Blueprint for Success

If you are looking to purchase a home within the next 6 months download your free USDA Blueprint for Success! This is a great educational resource for both buyers and Realtors.

For more immediate scenarios, click here to get pre-qualified for a USDA mortgage today!

So, keep us in mind for your next pre-qualification or if you have a current transaction experiencing financing difficulty and need an expert opinion.

Just call or email to discuss your scenario and let us show you the “Metroplex” difference!

Questions? Contact Us Here.

Toll Free: (800) 806 – 9836 Ext. 280

And don't forget, we are known for returning calls, replying to your emails, and responding to voice mails.

Please remember that mortgage requirements are constantly changing so stay current and up to date by subscribing on the right for future video tips.

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Posted in Florida USDA loans, USDA Funds Tagged

Oct 14

31

Are You Prepared For The Upcoming USDA Guideline Changes On 12/1/14?

USDA Rural Home loans are unique with both the benefits they offer and their qualifying guidelines.   Effective December 1st, 2014 the USDA program will experience a massive overhaul with many changes set to occur.

Today’s video tip will help you start to prepare for the upcoming USDA guideline changes and explain how it can benefit both Homebuyers and Realtors.

Before we get started, don’t forget to download our USDA blueprint for success with the link below. This free guide is designed to break down the process step by step and is a great educational resource for both Realtors and homebuyers alike.

So, are you prepared for the upcoming USDA guideline changes on 12/1/14?

Per USDA Rural Development, on the new 7 CFR 3555 handbook for Guaranteed Housing Loans:

“The rule represents a framework which will update, reorganize, and simplify the Single Family Housing Guaranteed Loan Program (SFHGLP). It enhances program effectiveness bystreamlining processes, reducing regulations, improving customer service, and strengthening the Agency’s ability to manage the program.”

Here are key highlights from the proposed USDA guideline changes:

  • Removal of the inground pool restriction. This is a big one, currently USDA loans will not include in their loan amount any value given to the pool. This has been a cause of great frustration in the past, and thankfully once effective, USDA loans WILL be able to finance homes with in-ground swimming pools.USDA Guideline Changes
  • Removal of the previous land to value limitation of 30%. Under current guidelines, if the site or land value exceeded 30 percent of the total appraised value of the property, additional criteria was required to ensure the property would be eligible.
  • Now, the specific 30% limitation requirement is removed. Provided the site size is typical for the area, this will have the potential to increase USDA financing availability on properties with increased acreage.

These are just 2 of the many USDA home loan qualifying changes which are coming about in the new CFR 3555 effective 12/1/14. In addition, there are going to be many more positive guideline changes and clarifications, which will assist more homebuyers in qualifying for a USDA loan.

Qualifying for a USDA home loan can be both difficult and overwhelming, but when you work with a lender that specializes and understands the USDA loan process, it is a match that can open the door to homeownership.

USDA Blueprint for Success

If you are looking to purchase a home within the next 6 months download your free USDA Blueprint for Success! This is a great educational resource for both buyers and Realtors.

For more immediate scenarios, click here to get pre-qualified for a USDA mortgage today!

So, keep us in mind for your next pre-qualification or if you have a current transaction experiencing financing difficulty and need an expert opinion.

Just call or email to discuss your scenario and let us show you the “Metroplex” difference!

Questions? Contact Us Here.

Toll Free: (800) 806 – 9836 Ext. 280

And don't forget, we are known for returning calls, replying to your emails, and responding to voice mails.

Please remember that mortgage requirements are constantly changing so stay current and up to date by subscribing on the right for future video tips.

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Posted in USDA FAQs

Oct 14

24

What are the differences between USDA and VA home loans?

What are the differences between USDA and VA home loans?

Both of these loan programs are extremely popular, but hold unique qualifying and eligibility requirements. As a USDA and VA approved lender, one of the most common questions I received is“What are the differences between USDA and VA home loans?

Before I review this question though, I want to remind you to download our USDA Blueprint for Success. This is a fee guide designed to help walk you through the USDA loan process step by step, and is a must have for those doing business in USDA eligible areas!

What are the differences between USDA and VA home loans?

To answer this, let’s start by reviewing a few similarities.

First, both USDA and VA home loans offer 100% financing. In other words, there is NO down payment required for either a USDA or VA home loan.

Next, both USDA and VA home loans are very specific when it comes to eligibility. Both of these loan programs offer unique criteria for eligibility, which are completely different from FHA and Conventional loan qualifying guidelines.

Flexible credit qualifying is available under both programs through reduced minimum scores, manual underwriting availability, and shortened time frames for recent bankruptcies, foreclosures, and short sales. Remember though that minimum credit conditions will apply, so let us know if you have a specific scenario to discuss.

Now let’s review the differences between USDA and VA loans.

USDA and VA Program Eligibility:

As I previously mentioned, both USDA and VA loans have specific requirements that must be met in order to be eligible for these loan types.

-USDA guidelines specify that applicants must meet household income limits as outlined per county and the property being purchased must be located in a USDA eligible area.

-VA loans on the other hand, are only available to eligible military service members.

The USDA Guarantee Fee and VA Funding Fee

-The USDA Guarantee fee of 2% is a one-time charge that can be financed into the loan. There is also a monthly premium that is calculated at .50%; e.g. $100,000 * .50% / 12 = $41.67

- The VA Funding Fee is also a one-time charge that can be financed, but the amount ranges depending on from 0% to 3.3%. The VA funding fee is calculated based on previous usage, loan type, type of veteran, and the VA funding fee can be waived for eligible applicants who meet service connected disability requirements.

USDA and VA Loan Closing Costs 

While any loan program can have associated closing costs or settlement charges, outside of the VA funding fee, VA home loans will not permit the option of financing out of pocket closing costs.

On the other hand, USDA loans permit the ability to finance out of pocket closing costs/settlement charges in cases where the appraised value is higher than the sales contract purchase price.

Metroplex Mortgage Services is an approved USDA and VA lender, and take pride in serving both the military and rural communities we work in. Take advantage of our 100% financing Government loan expertise, and use us as a resource for your loan qualifying questions

Qualifying for a USDA home loan can be both difficult and overwhelming, but when you work with a lender that specializes and understands the USDA loan process, it is a match that can open the door to homeownership.

USDA Blueprint for Success

If you are looking to purchase a home within the next 6 months download your free USDA Blueprint for Success! This is a great educational resource for both buyers and Realtors.

For more immediate scenarios, click here to get pre-qualified for a USDA mortgage today!

So, keep us in mind for your next pre-qualification or if you have a current transaction experiencing financing difficulty and need an expert opinion.

Just call or email to discuss your scenario and let us show you the “Metroplex” difference!

Questions? Contact Us Here.

Toll Free: (800) 806 – 9836 Ext. 280

And don't forget, we are known for returning calls, replying to your emails, and responding to voice mails.

Please remember that mortgage requirements are constantly changing so stay current and up to date by subscribing on the right for future video tips.

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Posted in Alabama USDA Loans, First Time Home Buyer, Florida USDA loans, USDA FAQs Tagged

Oct 14

17

How Can You Finance Closing Costs With A USDA Loan?

USDA Rural Home loans are sought after by homebuyers for their flexibility and one well known feature is the ability to finance out of pocket costs.

However additional guidelines do apply and today’s video tip will cover what you need to know to see when you can finance closing costs into a USDA loan.

Before we get started, don’t forget to download our USDA Blueprint for success with the link below. This free guide is designed to break down the process step by step and is a great educational resource for both Realtors and homebuyers alike.

So, how can you finance closing costs with a USDA loan?

As a starting point, USDA loans allow for No Down Payment (100% financing), but that should not be confused with No Money Out-of-Pocket . Customarily a buyer will have 2 types of out-of-pocket expenses:

1. Down Payment, and
2. Settlement charges (also known as closing costs)

USDA loans eliminate the need for a down payment, but the homebuyer is still responsible for their respective costs. This can be either paid by using their own funds, negotiated for the seller to pay through the sales contract, or in the case of a USDA home loan the possibility to finance those costs into the loan.

So, you can finance closing costs with a USDA loan, but only in cases when the appraised value is HIGHER than the agreed upon sales prices

Here are examples of what settlement charges can be financed into a USDA loan:

1. Closing Costs such as Title Charges, Loan Costs, Survey, Recording Fees, etc.)
2. Pre-Paid Items such as your Escrow Accounts, Homeowner’s Insurance Premium, and Pre-paid Interest.

Key points to remember are that the appraised value must be higher than the sales price for this feature to be available. This is unique for USDA home loans, and not available under Conventional, FHA, or VA programs.

Homebuyers should be cautious if they are solely relying on financing closing costs to cover their out-of-pocket expenses, because that is determined by the final appraised value which happens after the sales contract is agreed upon. Financing closing costs should be viewed as a potential advantage, not a guarantee!

Qualifying for a USDA home loan can be both difficult and overwhelming, but when you work with a lender that specializes and understands the USDA loan process, it is a match that can open the door to homeownership.

USDA Blueprint for Success

If you are looking to purchase a home within the next 6 months download your free USDA Blueprint for Success! This is a great educational resource for both buyers and Realtors.

For more immediate scenarios, click here to get pre-qualified for a USDA mortgage today!

So, keep us in mind for your next pre-qualification or if you have a current transaction experiencing financing difficulty and need an expert opinion.

Just call or email to discuss your scenario and let us show you the “Metroplex” difference!

Questions? Contact Us Here.

Toll Free: (800) 806 – 9836 Ext. 280

And don't forget, we are known for returning calls, replying to your emails, and responding to voice mails.

Please remember that mortgage requirements are constantly changing so stay current and up to date by subscribing on the right for future video tips.

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Posted in USDA FAQs

Oct 14

10

Do You Have To Be On The Same Job For 2 Years To Qualify For A USDA Loan?


Do USDA guidelines require that you work at the same job for 2 years to qualify for a USDA loan?

As you can imagine, guidelines regarding employment history are critical when trying to qualify for a USDA loan.

Today’s video tip will go into detail on the specifics regarding employment history and USDA home loan qualifying.

Do you need to be on the same job 2 years to qualify for a USDA Loan?

USDA guidelines state the following regarding employment:

There is no minimum length of time an applicant must have held a position to consider employment income as dependable.

However, the lender must verify the applicant’s employment for the most recent two full years and verify that the applicant’s income has been stable.
If an applicant indicates he or she was in school or in the military during any of this time, the applicant must provide evidence supporting this such as college transcripts or discharge papers.

If the applicant has recently re-entered the workforce after an absence to care for a family member or minor child, extended medical illness, or other circumstance reasonable to the lender, the applicant must provide evidence.
The applicant should not have any gaps in employment of more than a month within the two year period prior to making the loan application.

It remains the lender’s responsibility to analyze the gaps in employment as it relates to the probability of continued income.

Applicants that have not been employed for 12 months with their current employer or have experienced a significant earnings increase are considered high risk. Lenders must ensure the applicant will have the required stable and dependable income to carry the mortgage debt.

Same job for 2 years to qualify for a USDA loan

It is important to point out, that while you do not have to be on the same job for 2 years in order to qualify for a USDA loan, approved lenders must still determine stable and dependable monthly income from verified sources.

Please remember that job stability provides strength with your qualifying and having long time employment at the same job can be a very strong compensating factor towards both underwriting and USDA Rural Development approval.

Qualifying for a USDA home loan can be both difficult and overwhelming, but when you work with a lender that specializes and understands the USDA loan process, it is a match that can open the door to homeownership.

USDA Blueprint for Success

If you are looking to purchase a home within the next 6 months download your free USDA Blueprint for Success! This is a great educational resource for both buyers and Realtors.

For more immediate scenarios, click here to get pre-qualified for a USDA mortgage today!

So, keep us in mind for your next pre-qualification or if you have a current transaction experiencing financing difficulty and need an expert opinion.

Just call or email to discuss your scenario and let us show you the “Metroplex” difference!

Questions? Contact Us Here.

Toll Free: (800) 806 – 9836 Ext. 280

And don't forget, we are known for returning calls, replying to your emails, and responding to voice mails.

Please remember that mortgage requirements are constantly changing so stay current and up to date by subscribing on the right for future video tips.

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Sean Stephens

Metroplex Mortgage Services

Contact Me Here
Toll Free: (800) 806-9836 Ext. 280
NMLS ID# 185288

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USDA Loan Calculator

Use This Calculator To Help Stay Within Your Budget:

Purchase Price
Loan Term 30 Years
Interest Rate
Annual Taxes
Annual Insurance
Financing: 100%
Purchase Price with
2% Guarantee Fee
Principal & Interest
USDA Premium
Total Estimate

*Taxes and Insurance can vary from property to property.

Note: This USDA Loan calculator is for estimating purposes only and is neither a Good Faith Estimate or Commitment to Lend.

Minimum credit conditions will apply on all loans.

Zillow Testimonials

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' Sean Stephens and his team at Metroplex Mortgage truly do offer legendary customer service. We would not be in our new home without the very ... more '
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' My experience with MetroPlex Mortage Services was a very good one. Anytime I had any questions they were answered. Sean was very helpful with ... more '
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' Sean and his team were AMAZING! As a first time home buyer they kept me informed of everything that was going on and what was still to come. They ... more '
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