September 2014 USDA Interest Rates

Low interest rates

The beginning of September brings us low USDA mortgage interest rates, pretty much the same as last month. Rates over the last 30 days have been at their lowest level in all of 2014. Rates are staying the low 4% range depending on loan program, credit score, etc.  It’s a great time to take advantage of the USDA 100% financing here in Florida.  In addition, those homeowners that currently have a USDA mortgage should learn about the USDA Pilot Refinance program while interest rates are still low.  The USDA Pilot refi program allows homeowners to refinance into a new low rate regardless of loan to value – learn more about all the USDA Rural refinance FAQ’s here.

 

Questions about current USDA home loan rates?  Just submit the quick form on the right side or call ph: 904-302-6060

September 2014 USDA Interest Rates

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USDA Rural Development Loans Quick Facts

USDA Facts

Here are some USDA Rural Development Loans Quick Facts below. If you have questions please call us at 904-302-6060 or just submit the fast request form on the right side of your screen  →

  • When most folks think “USDA” they think about food inspections and not home loans. But home loans have actually been offered for many years under the USDA Department of Rural Housing. Since the demise of the nearly all 100 percent home loans programs in the past, the USDA program has become very popular option. $0 money down USDA helps to fill the gap for homebuyers that want to purchase a home but have limited money saved for big down payments required by conventional and FHA loans.
  • Basic definitions – USDA means United States Department of Agriculture.  RD-  means Rural Development.  RHS means Rural Housing Service.  USDA loans are often referred to as any of the above – USDA, RD, RHS, etc.
  • The USDA 502 Guarantee program housing program still offers 100 percent financing in select locations around Florida  The USDA 502 Guarantee program is for moderate income households and the loans are processed by approved USDA lenders and banks (not the USDA directly)
  • USDA loan interest rates are very competitive and offer secure 30 year fix payment terms.
  • Any homebuyer that meets the eligibility guidelines can apply,  applicants are not required to be a first time home buyer.  The critical eligibility requirements are the location of the home and household income limits.
  • Any livable house ( not mobile homes)  in sound condition is permitted under the USDA Rural Development program.  The house just has to be located in an area that is approved by RD. The approved map can be found here.

Many of the most common USDA FAQ’s can be found here.  Please contact us with any questions about pre approval lender requirements.

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FHA Mortgage Great Alternative

Not all Florida borrowers meet the eligibility requirements for the USDA loan. Maybe you are looking to purchase a home in a more populated location like Tampa, Orlando, Miami that is not approved. Or maybe your household income is over the limit in place for USDA.  If that is the case, the FHA mortgage may provide a great alternative . Government backed FHA loans have been helping home loan applicants become homeowners for 80 years. In 2010,  FHA announced a set of policy changes to strengthen the FHA. The changes announced are the latest in a series of changes to better position the FHA to manage losses while continuing to support the nation’s housing market recovery.

Most Florida FHA lenders require a minimum credit score of 620 to be approved for financing. FHA allows a homebuyer to make a down payment of just 3.5% and a seller contribution of up to 6% for closing costs!  In addition, the required down payment can be gifted to the borrower from family, etc.  First time home buyer with credit scores below 620 must make a minimum 10.0% down payment of the purchase price and a seller concession of up to 6% to pay for closing cost is allowed. This traditional FHA mortgage is great for first time homebuyers looking to maximize their savings by minimizing their down-payment because FHA only requires 3.5% down with home financing to 96.5% loan to value.

Popular FHA purchase programs:

  • 203(b) FHA purchase program provides mortgages for home buyers  to purchase a principal residence with a low down payment and with lower credit standards.
  • 203(k) FHA purchase program is for the rehabilitation (rehab) and repair of single family properties. Providing both the financing to purchase a property and the financing to make repair. The program offers an important tool for expanding home ownership opportunities.

FHA Refinance Options:

Homeowners that currently have an FHA loan and want to refinance can learn more about the variety of refinancing options available today in Florida. Interest rates a very low in 2014!

FHA Streamline Refinance – This FHA loan is an exclusive offer to existing FHA borrowers who seeks a rate and term refinance to lower the mortgage payment or improve the lending terms. The FHA Streamline is designed to lower the interest rate on a current FHA mortgage or convert a current FHA adjustable rate mortgage into a fixed rate. A Streamline FHA Refinance Loan can be performed very quick and easy .. or “streamlined”   It typically requires less red tape than a normal refinance and sometimes no appraisal, qualifying debt ratios or income verification.

FHA Cash Out Refinance – The FHA 203B loan is a refinance mortgage that FHA offers for refinancing 1st and 2nd mortgages into one loan up to 95% loan to value.  This cash out refinance loan enables homeowners to consolidate debt and loans at a very low interest rate.

FHA Rehabilitation – The 203K mortgage is a unique loan because it provides funds for home improvement up to 115% loan to value.  This has become a very popular financing tool with people who buy a foreclosed home that need additional funds for home rehabilitation.

FHA Secure Refinance – The 203S loan was a refinance product that was created a few years ago for distressed homeowners that were struggling with the rising rates from an ARM.  With FHA Secure refinancing, borrowers can be delinquent on their mortgage payment, but must have no mortgage payments reported late prior to the interest rate resetting and adjusting.

Read all the latest FHA Mortgage Q&A here  Questions about FHA loans in Fla or GA, please call 904-302-6060 or visit www.fhamortgagesource.com

FHA Mortgage Great Alternative -2014

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Future USDA Eligibility Maps Now Available

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Future USDA Eligibility Maps Now Available!  The USDA / Rural Housing eligible area maps are available on the USDA Income and Property Eligibility Site.  Click on “Future Eligible Areas” to preview the areas in FL that will be affected.  Applications received beginning October 1, 2014 will be subject to the new eligible area maps.  Please be advised that every effort has been made to provide accurate and complete information regarding proposed ineligible areas on this website based on Rural Development rural area requirements as defined in the 2014 Farm Bill, using 2010 census data. Some minor modifications to areas may occur prior to the October 1, 2014 implementation.

To learn more about the 100% USDA loan, please read the USDA FAQ’s here.  If you have questions, we want to hear from you! Please reach out to us by sending the quick request form on the right side, or call ph: 904-302-6060

Is your location ineligible for the USDA loan? You can learn more about the FHA loan by clicking here.

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USDA Streamline Refinancing Lower Rate

USDA Mortgage Florida

Florida homeowners that purchase their house using a USDA  502 Guaranteed Loan now can refinance into a lower interest rate. The USDA Pilot and Streamline refinance lets borrowers refinance via approved USDA lenders into a lower interest rate so that they can lower their monthly mortgage payments to more manageable levels.

Those looking to refinance through the USDA —even if they are underwater on their homes — may have the following options. In each option, the borrowers must have a Section 502 Direct or Guaranteed Loan and provide income documentation for all borrowers in the household. The residence must be their primary residence, and properties that were eligible for the loan at their origination that have now become ineligible can still qualify for the refinancing program. All loans will be refinanced at a fixed rate for 30 years and are subject to a 2 percent upfront fee and a 0.4 percent annual fee.  The 2% guarantee fee and all closing costs can be put back into the new loan so the homeowner has no out of pocket costs.

Streamlined USDA Refinancing

This option, which is available only for Guaranteed Loans, does not require an appraisal. The new loan amount can’t be more than the principal on the existing loan plus a guarantee fee of 0.5 percent of the loan amount. In addition, the accrued interest, closing costs and lender fees can’t be folded into the new loan. The lender will run your credit report (borrowers with bad credit must have a credit waiver) and will require a debt-to-income ratio of 29/41. This means that the lender prefers that your housing costs don’t exceed 29 percent of your monthly gross income and that your total housing costs plus other debt payments don’t exceed 41 percent.

Non-Streamlined USDA Refinancing

The non-streamlined program, which requires an appraisal, is available for Section 502 Guaranteed Loans. The interest, closing costs, guarantee fee of 0.5 percent of the loan amount, and lender fees can be folded into the loan — as long as the borrower has built up sufficient equity in the house (this is determined by the appraisal). The maximum loan amount can’t exceed the fair market value of the home, which will be determined by the appraisal. The lender will run your credit report (borrowers with bad credit must have a credit waiver) and will require a debt-to-income ratio of 29/41.

USDA Rural Refinance Pilot Program

This program is only available in select states, Florida being one of them!  This program is also available to those homeowners with a 502 Guaranteed Loans. If you are refinancing a guaranteed loan, you will not need an appraisal.  Your loan to value is not important.  All pre-paid interest, closing costs, guarantee fee 2 percent of the loan amount, and lender fees can be folded into the loan. The lender only has to verify that your last 12 months of mortgage payments were made on time. If a credit report is run, the lender can only use the mortgage payments with which to evaluate the borrower. The pilot program does not have debt-to-income requirements. The new interest rate will be fixed at a minimum of 1 percent below the current rate and the loan will be for 30 years.

To find out which Government backed relief  plan is best for you, contact us by calling 904-302-6060 or visit http://www.usdamortgagesource.com/usda-pilot-refinance.html   Also be sure to read all the helpful USDA refinance FAQ’s here.

USDA Streamline Refinancing Lower Rate FL

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