How do you qualify for the No Down Payment USDA Loan Program?
If you are interested in applying for a USDA home loan to purchase an existing property, include home repairs after closing, or for a new construction property, the USDA home loan program can be a solution!
In today’s video, I will share important requirements of the USDA Loan Program along with key reminders about how to maximize your USDA qualifying.
Before we get started, don’t forget to take advantage and download our USDA Blueprint for Success with the link below. This free guide is designed to walk you through the USDA loan process step-by-step and is a great tool for both homebuyers and Realtors alike.
How do you qualify for the No Down Payment USDA Loan Program?
The USDA loan program is sought after by homebuyers due to no down payment, affordable terms, and flexible credit qualifying. If you are a homebuyer looking to purchase a home in an eligible rural area, you may be able to qualify for this tremendous program. Let our experience as a USDA Approved Lender go to work for you!
Qualification Requirements
1. Property Eligibility: The subject property being purchased must be located in an approved USDA Rural Development area. There are no exceptions to this policy. Eligible areas can vary per county, so be aware when planning to look for homes. You can search properties on the USDA Property Eligibility Map.
2. Income Limitations: There are income limitations based on family household size. USDA loans take into account income from all family household members, and not just who is on the loan. This can be complicated, so contact us for any specific questions.
Income limits vary by county within each state. However, although it is good to know what USDA INCOME LIMITS apply to your area, remember that there are also deductions that can apply which help reduce that income such as for child care expenses and other items. Be sure to check with my team for guidance on how to properly calculate USDA income limits.
3. Flexible Credit Qualifying: While minimum credit conditions will apply, and additional qualifying conditions may be needed for approval, USDA loans offer high flexibility when it comes to credit qualifying for previous bankruptcies, short sales, and foreclosure.
Also, exceptions can be possible for reduced waiting periods after these events, but each situation will be case by case so please check with my team so we can review and advice.
Additionally, where there are situations with limited credit history, USDA loans will also allow what is call non-traditional or alternative credit history such as verification of rent or utility payment histories to support a qualifying credit reputation.
4. USDA Loans are NOT just for First-Time Home Buyers: Many associate the USDA loan program with only being for first-time homebuyers, but they are also available for previous homeowners.
Key points to remember when qualifying for the No Down Payment USDA Loan Program:
- The property must meet USDA property eligibly requirements
- There are income limitations for a USDA loan based on
- family household size
- Flexible Credit Qualifying
- Not limited to just first-time homebuyers
The USDA Loan Program qualifying process may be overwhelming, but as a USDA Approved Lender, we are here to help explain the process step-by-step!
Metroplex Mortgage Services is a USDA Approved Lender that is licensed throughout Florida, Texas, Alabama and Tennessee. Just call or email to discuss your scenario and let us show you the “Metroplex” difference!
800-806-9836 Ext. 280
SeanS@MPLX.org
As always, I want everyone to make it a great day, and look forward to seeing you right here for the next tip of the week!
P.S. – You can download our “USDA Blueprint for Success” by CLICKING HERE
