Thursday, July 17, 2014

Rural Development Loan

USDA Rural Development loans are designed by the government to help medium income Americans living in rural and suburban communities buy a new home. They are the most competitive loan in the market
  • NO money down
  • Low interest rates
  • 30 year fixed rates
  • Government guaranteed
  • You have the ability to roll in your closing costs into the loan
  • Flexible credit guidelines

The Rural Development Home Loan is a 30 year fixed rate loan available for low to moderate income families who are looking to buy, build, improve, repair, or rehabilitate homes in rural areas. If a buyer has had ownership of a primary residence in the last three years, they are not eligible for the program. To qualify for a Rural Development loan buyers must meet the MSHDA (Michigan State Housing Development Authority) sales price, income limit, and first time home buyer eligibility guidelines. All adult members of the new home must apply jointly for the loan.

The Rural Development loan is known as the no money down home loan.

This is because applicants can borrow 100% of the home’s cost! The Rural Development Loan is the only zero down loan offered to those who have not served in the military. The maximum amount guaranteed by Rural Development can include closing costs, prepaid/escrow items, and the RD guarantee fee. Most Rural Development Loan applicants receive almost all of their earnest, also known as good-faith deposit, back after closing. However, the maximum loan amount cannot include repairs and/or improvements to the property.

Who applies for a Rural Development Loan?
Those wanting to stop renting and buy a home with zero down.

Families and individuals looking for their first home.

People in rural areas.

What areas are considered Rural Development Areas?
Rural Development Loans are offered in areas with a population of 20,000 or less people. Right now, the areas that qualify are and home in Genesee county North of Stanley rd., any home West of Elms Rd., Any home East of Potter Rd., and any home South of Grand Blanc Rd.
What Properties are eligible?
New homes or builders’ models that have not been previously occupied

New condominiums approved by the FNMA or FHLMC

Existing homes that have been previously occupied

Existing Condominiums that have been previously occupied.

New manufactured homes approved by RD.

**All must be in Rural Development Areas**

Income Limits
Household income cannot exceed 115% of the median household income of the area.

A family of 1 – 4 cannot exceed an income of $74,050

A family of 5 – 8 cannot exceed an income of $97,750

Occupancy Requirements
Borrower(s) must occupy the property within 60 days of closing.

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