The USDA Rural Housing mortgage has become the first choice to the majority of first time homebuyers in Levy and Dixie County. The USDA loan program offers several benefits, keeping in mind the budget constraints of most homeowners who are interested in buying their very first home. Compared to most conventional or FHA mortgage loans, the USDA program facilitates the buying process for the applicant by allowing 100% financing. Also the USDA loan involves a $0 payment, which makes it easier for homeowners to meet their budget constraints.
- Secure fixed interest rate– One of the biggest advantages of the USDA loan is the fixed 30 year interest rate. Compared to other traditional loans where the interest rates can vary, the interest rate remains the same for the entire course of the loan. No prepayment penalty or adjustable-rate terms. Due to this provision, the borrower can plan out his fixed monthly installment in advance.
- NO down payment – The Federal government insures or backs USDA loans, therefore the borrower /applicant incur very minimal charges during the process. USDA loans require $0 investment from the borrower. The loan does allow for the home seller to pay all closing costs, up to 6% which is generally enough to cover just about any home purchase.
- Simple to qualify – Pre-qualifying for a Florida USDA loan is one of the simplest. Since it is the USDA that insures your house loan, the lenders and banks make it easy for anyone to qualify that meets the basic requirements. The main components of qualifying are credit and income/employment.
- There are no cash reserves required – Compared to most conventional loan programs, which make the Florida USDA mortgage loan a very enticing option for Florida first time homeowners that have little money saved up. Applicants don’t need any savings to be approved.
- Approved Locations – The USDA 502 Guaranteed RHS program is reserved only for certain rural locations in Florida. The good news ALL of Levy and Dixie county is approved – Cedar Key, Chiefland, Old Town and surrounding locations are all eligible for USDA financing.
First Time buyers need to know what to expect before starting the USDA loan application process. Being prepared will always increases your chances in successfully getting your USDA loan approved. Below we have listed some steps and things to consider –
Before application:
- Debt-to-income ratio
Careful analysis has to be done here. Lenders vary on precise amounts but a debt load that’s higher than 41 percent is risky for an USDA loan. You will need two years of consistent employment with no unexplainable gaps in employment. - Credit check
It’s usually the small things that can hurt your credit. Check your income, credit, as well as rent history that might show up on a credit report. Get everything on the up and up, aiming for a clean record. - Credit score
As of 2015, a credit score of 620 or better is needed for the 100% USDA loan. If you came out of a bankruptcy or foreclosure, you would need to have maintained a perfect credit since then (4 years respectively) regardless of current credit score.
USDA Loan Application:
- Interested buyers can start by submitting the short Info Request Form on the right side of this page to get started. Mobile users can find the Info Request Form at the bottom of this page. You can also contact us at 7 days a week at ph: 800-743-7556. This will allow the USDA loan specialist to contact you to discuss your goals. Later a full application will have to be filled out that detail everything about you, the borrower, which will be used in figuring out whether you’re eligible for a loan or otherwise. The rate and the terms of the loan will also be determined largely by the information in your application form, credit score, etc. The complete USDA application process takes about 20 min to complete.
- In the event your USDA application is pre-approved, and you go under contract to purchase a home, you will get the disclosure documents which are essentially mortgage disclosures that have all the minute details regarding the terms, interest rates, cost and payments of the loan.
- These lender mortgage disclosures are to be signed and returned along with other documents such as your bank statements, IDs, pay stubs, etc., for verification purposes. Usually these documents are prepped and readied well before the loan application is submitted to the lender.
- The processor reviews all verifying documents and requests for missing or any additional documents from the borrower if need be. Upon completion, the documents are then submitted to the underwriter.
- The underwriter will send a Conditions List of additional missing items or documents to the buyer.
- Once the buyer completes the needed items on the list, it’s sent back to the lender for final approval. A closing date is then set.
Note: Once you are in contract on a home, the entire USDA closing process takes about 4-5 weeks to complete.
USDA Mortgage Source is Florida’s leading 100% Rural Development loan resource. Serving Levy County and Dixie County 7 days a week including, Bronson, Cedar Key, Chiefland, Fanning Springs, Gulf Hammock, Inglis, Morriston, Rosewood, Williston, Yankeetown, Cross City, Horseshoe Beach, Jena, Old Town. Please contact us at 800-743-7556.