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What are the differences between the USDA Direct and USDA Single Family Housing Guaranteed Loan Programs?

February 18th, 2022 by Sean Stephens

USDA Single Family Housing Guaranteed Loans in Florida, Texas, Tennessee, & TennesseeWhat are the differences between the USDA Direct and USDA Single Family Housing Guaranteed Loan Programs?

There are differences between the USDA direct and USDA single family housing guaranteed loan programs. USDA Rural Development offers single family housing under both 502 Direct Loans and the USDA Single Family Housing Guaranteed Loan Program. Thus, it is common to receive questions from homebuyers and realtors regarding the differences between the USDA Direct and the USDA Single Family Housing Guaranteed Loan Program as these are two different, yet similar programs.

If you have not done so yet, be sure to download our FREE USDA Blueprint for Success. This educational resource is designed to help walk you through the USDA process step-by-step and is designed for homebuyers and realtors alike.

What are differences between the USDA Direct and USDA Single Family Housing Guaranteed Programs?

USDA Single Family Housing Guaranteed Home Loan vs. USDA Direct Loan Program

What are differences between the USDA Direct and USDA Single Family Housing Guaranteed Programs?

The USDA Single Family Housing Guaranteed Loan Program and the USDA Direct Loan Program both require that the home being purchased is a primary residence. However, there are four key differences between each program.

Differences between the USDA Direct and USDA Single Family Housing Guaranteed Loan Program in Florida, Texas, Tennessee, and Alabama

Key Differences Include:

  • Income Limits: While income limits do apply under either program, the Guaranteed Loan Program has higher family household income limits when compared to the Direct Loan program, which has lower income limits.
  • Term Length: Guaranteed loans offer a 30-year term, while the standard term for a Direct loan is 33 years, plus other terms could apply based on varying situations.
  • In-Ground Pools: The Single-Family Housing Guaranteed Loan Program allows for in-ground pools, while the Direct loan program does not permit in-ground swimming pools.
  • Funding: The biggest difference between these two loan programs is that Guaranteed loans are not subsidized and instead are funded by approved USDA lenders such as Metroplex Mortgage Services who handles the underwriting review, approval of the file, and loan closing. On the other hand, Direct Loans are subsidized and funded by the Government. They are then serviced by USDA Rural Development’s customer service center.

USDA Approved Lender in Florida, Texas, Tennessee, and Alabama.

Metroplex Mortgage Services is a proud USDA Approved Lender!

Remember, our USDA Approved Lender status allows us to control the USDA Rural Development Single Family Housing Loan qualification process from pre-qualification to closing with the added benefit of in-house underwriting and one easy point of contact.

As a USDA Approved Lender in Florida, Tennessee, Alabama, and Texas, let our USDA experience and expertise go to work for you!

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

Toll Free: (800) 806-9836 X 280

Call/Text: (863) 451-3032
SeanS@MPLX.org

Don’t forget to download our USDA Blueprint for Success with the link below:

 

USDA Blueprint for Success

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