If you’re looking into owning homes in the rural areas, it’s well worth looking into USDA loans. Among their rural housing loan programs, the guaranteed loan is one of them.
To be more specific, Single Family Housing Guaranteed loan is all about helping low and moderate income households own a modest home for the family to live in. These loans run for 30 years. Its interest rates may vary depending on the lender.
Who are eligible?
Certain applicant eligibility requirements are set by the USDA. In line with all the guidelines, the borrower should have an income that doesn’t exceed the 115% median income for the area of the property you want to buy. Having the ability to pay the mortgage and showing a reasonable credit history are also looked into. Other than that, the applicant should occupy the property and list it as their primary residence.
Is my property considered eligible?
The borrower should determine first if his property is eligible for a USDA guaranteed loan. A common misconception that the word “rural” might rise since the loan is backed up by the USDA it would mean that the property should either be a farm or be somewhere far off but it’s not actually the case. Consulting their website for property eligibility might give you some direction.
What can eligible applicants do with the funds?
With their funding, among the things that eligible applicants can do to their desired property are to rehabilitate, build or improve the property. More specifically, they can purchase a brand new property as a residence, buy existing properties, buy household equipment and energy efficiency measures for the property. Site preparation costs can also be included.
What is the application process?
First, applications are submitted through approved lenders. Should there be any more questions regarding application and eligibility, an approved lender can provide answers for you. If ever you can’t find an authorized lender, a Guaranteed Loan Coordinator from your state can help find one for you.