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What Is A Usda Loan?
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Many people wonder about what is a USDA loan? A USDA loan or a Rural Development Loan is essentially a government-backed home loan that permits you to buy a home without Money down. USDA Loans Texas offer 100% financing to any qualified buyer. All the closing costs can be paid either by the seller or can be financed into the actual loan. USDA is a preferred choice for many people as it offers some of the lowest loan rates and the rate of interest is always fixed. It means assurance and peace of mind and your money and investment remain safe.
Just as with any loan, there are some eligibility criteria that an applicant has to meet for USDA loans. There are three primary factors that determine an applicant’s eligibility. The first thing that is taken into account is the person’s credit-worthiness. Whenever your credit history is reviewed by an underwriter the primary thing they will be looking for is whether you have been paying all your bills in a timely manner. Any past blemishes will be overlooked as long as your credit history over the past 12 months is clean.
If there are any open collections or judgments, those will have to be cleared before your application for USDA Loans Texas is considered and you close on a new home. Apart from your credit worthiness, there are some restrictions for USDA Loan Income. You will need to document your income on the USDA Loan. Generally, USDA will want to see a 2 year history of consistent income or employment or. Exceptions on this 2-year requirement may be made for applicants like students. No assets are needed for approval on USDA Loans but they go a long way in erasing any possible blemishes that exist in your credit.
Another important criterion that will be looked into is about your residence location. In order to qualify for the USDA Loan, your home has to be located in the rural area that is designated by the USDA. Not many people are aware that many areas of the U.S qualify for these no money down USDA loans. The objective of the USDA loan program is to assist the smaller and rural communities in the country thrive by making property and land more affordable. Currently, the USDA doesn’t permit the buyers to own any another property and purchase another home via the USDA program.
This loan program is specifically designed for buyers who don’t qualify for other financing and those who don’t have adequate housing. Nevertheless, there are some circumstances wherein the USDA will permit you to keep your other home. For example, a mobile home is not considered to be adequate property by the USDA and you might be able to keep it. Other situation is if your current home is not sufficiently large enough for the members in your family and you have to move. You can get a lot of information regarding the eligibility and information about what is a USDA loan by filling-out the USDA Loan Application.
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