Where's home for you?
Is it living in a quiet suburb with friendly neighbors, just a car ride away from your favorite Italian restaurant or movie theater? Or have you always longed to live in a more secluded and natural setting, miles away from your nearest neighbor?
Whether you choose the suburb or the country, the USDA Rural Development Loan might help you reach your destination. What is it, exactly? The Rural Development loan is a 100% financed home loan, insured by the United States Department of Agriculture to promote homeownership in less-dense communities. It can be a good option if you're buying your first home or having trouble saving for a down payment. It's one of the few loans, other than the VA loan, that doesn't require you to have cash upfront for the down payment.
The main criteria for the loan is that the home needs to be located within certain geographical areas that are rural, or less-populated, as designated by the USDA. This often includes villages, small towns and suburban areas near larger cities and includes many locations that may surprise you. Many people do not realize that properties in almost every area of the country outside major metropolitan centers can be purchased with a USDA Loan. Check here for USDA Rural Development Eligibility (on this page click "Single Family Housing" under "Property Eligibility"). You will also find credit score requirements and income limits with the USDA Rural Development loan.
- No Down Payment Option (100% financing)
- No cash reserves required
- Flexible credit and qualifying guidelines
- Seller can pay closing costs
- Low fixed interest rate
- Ability to finance repairs and closing costs into the loan
- No maximum purchase price
Do you qualify?
- Home must be located within a designated geographical area.
- Eligible property types include existing and new construction single-family homes and condominiums
- Household income must not exceed the adjusted income limit for the area
- You must be a citizen, permanent resident or qualified alien
If you're wondering if you and your proposed property qualify for a USDA Rural Development loan, contact an Amerifirst branch close to you or send us a message. One of our friendly loan officers will be happy to give you more details about it. We're always happy to help!
Compare the USDA Rural Development Loan and the FHA Loan - two popular options for first-time homebuyers.
Wondering what it takes to buy your first home? Download our free Get Mortgage Ready eBook.