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Can you have two USDA loans at the same time?

October 27th, 2017 by Sean Stephens

Can you qualify for a USDA loan before your current home has sold?

I know, I know, today’s topic may not seem exciting at first, but knowing the details could mean the difference between loan approval or being denied and sitting on the sideline. In this short video will share the facts to help keep your financing headed to the closing table.

Remember, if you need help or a have question that is what we are here for, so just call or email to discuss your scenario because we are known for returning calls, replying to emails, and responding to your messages. Now, wouldn’t it be nice if everyone did that!

Now, it is common for my office to receive questions on the following types of scenarios:

  • Can you have two USDA loans at the same time?
  • If your home is listed for sale, can you qualify for a USDA loan prior to that one selling?
  • What if you are relocating from outside the area and will now be renting that property?

These are all good questions, and USDA guidelines have the following requirements when trying to qualify for a USDA loan while you still own another dwelling:

  • The homeowner will occupy the home financed with the guaranteed loan as their primary residence throughout the term of the loan;
  • The homeowner is financially qualified to own more than one house
  • The loan applicant is limited to owning one additional single family housing unit along with the new property they are purchasing with the USDA loan
  • The current home owned no longer adequately meets the applicants’ needs.
    • Manufactured housing units that are not fixed on a permanent foundation are considered functionally inadequate
    • Relocations or Transfers for employment that are not within a reasonably and locally recognized commuting distance
  • The existing dwelling is not already financed by another Rural Development guaranteed or direct loan or active grant
    • This means that the buyer may only have one USDA loan at the same time!

In summary, while it is not possible for you to have two USDA loans at the same time, there are exceptions available if a homebuyer wants to qualify for a USDA loan while they still own another residence.

As you can see, this can be a very technical part of the guidelines, so if you have questions or a specific scenario, please use my team as a resource!

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I know, we sure covered a lot today, so if you have any additional questions, just simply call or email to discuss your scenario, inquire about a new pre-qualification, or ask about our free 2nd opinion service to help your financing stay on track.


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