USDA Loans: Financing Your Rural Home Dream
Are you interested in buying, building, repairing or refinancing a home in a rural suburban area? If so, you’ll definitely want to consider financing through the Single Family Housing Guaranteed Loan Program. This program provides affordable home loans to clients with low to moderate income who are willing to look outside of major cities for housing. The program sponsored through the United States Department of Agriculture (USDA) and funded through private lenders. This means lenders have more confidence providing funding to a broader range of clients – which means easier qualifying. If you’re interested in learning more about USDA loans, contact Caleb Parmenter – Big Valley Mortgage. Our mortgage professionals have local expertise in Fresno, Clovis, Madera, Visalia, and surrounding California. We have partnerships with national lenders, which means great rates for you and streamlined application and closing processes.
USDA Loan Basics
The USDA assists approved lenders in providing funding to borrowers by insuring 90% of the value of the USDA loan. This means that if a borrower defaults – fails to pay – on his or her loan, the USDA agrees to pay back the lender. This means less risk for lenders, who are then encouraged to approve financing for borrowers even if they have less-than-great credit history.
USDA loans do not require a down payment and they have fixed, long repayment terms for those who qualify. They can be used to purchase a new property, to make repairs or rehabilitations to an existing dwelling, to refinance other loans, to improve a home to accommodate a resident with a disability, to pay for site preparation costs, to promote energy efficiency, and much more.
USDA Loan Eligibility
If a USDA loan sounds like it might be the right fit for your mortgage needs, the next step is to make sure you qualify for the program and that you look for a home in an approved area. For our purposes today, we’ll be discussing the Single Family Housing Guaranteed Loan Program, for people with low to moderate income. (If you have very low income, contact us for more information on the Single Family Housing Direct Loan Program.)
In approved parts of Fresno, Madera, Visalia and families with 1-4 people cannot exceed and income of $78,200, and families with 5-8 people must not exceed $103,200. In addition to meeting these income requirements, you must also:
- Agree to personally occupy the home you purchase as your main residence
- Be a U.S. Citizen, U.S. non-citizen national or Qualified Alien
- Have the legal capacity to incur the loan obligation
- Demonstrate ability and willingness to make payments on time
- Not be in default of any other government-sponsored programs
Get Preapproved and Begin Your Search
Once we’ve determined you meet the income requirements and understand the other personal requirements, we may be able to preapprove you for a loan. Then, you can begin to look at eligible homes in USDA-approved rural zones. Working in conjunction with your real estate agent or Realtor, we can determine where you should begin your search for the home of your dreams.
Let’s Find the Right Financing for You
Whether you have questions still about USDA loans or are ready to begin the process of getting approval, we’re here to help. The mortgage professionals at Caleb Parmenter – Big Valley Mortgage are experts in USDA loans and all other types of home financing. If you are interested in purchasing, rehabilitating a home or refinancing an existing loan in Fresno, Clovis, Madera, or Visalia, contact us to schedule a consultation.