Do you know the minimum property requirements for a USDA loan?
What are the minimum property requirements for a USDA loan?
The question of USDA minimum property requirements is a common one that I receive, and today we will cover the basics that need to be known for buyers, sellers, and Realtors alike.
However, before we get started please take advantage of our free Second Opinion Service “SOS” which is designed to help Realtors and buyers get access to an expert second opinion and is great for both new pre-qualifications and loans that are already in progress.
What are the minimum property requirements for a USDA loan?
USDA loans are covered by FHA HUD Handbook guidelines for minimum property 
requirements (MPRs).
An FHA roster appraiser may certify compliance to the handbooks when inspecting the property
However, it is not acceptable for an appraiser to simply comment that the property “appears to meet” or “seems to meet” HUD Handbook requirements.
So what are some red flags to look out for?
While there can be any number of issues that may require repairs, a good rule of thumb is to observe the following:
- Safety,
- Sanitary, and
- Structurally Sound
If your concerns impact any one of these aspects of the home, then it may very well need to be corrected prior to closing.
Remember that today’s topic covered USDA minimum property
requirements, but understand that additional conditions can be requested by the underwriter or appraiser that go above and beyond depending on the circumstances of the situation.
Now, if you have a loan in process and a transaction underway, it would be best to discuss any specific property related concerns with your lender and Realtor.
Additional resources on HUD Minimum Property Requirements can be found at:
https://portal.hud.gov/hudportal/HUD?src=/program_offices/administration/hudclips/handbooks/hsgh
