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ZERO DOWN GUARANTEED RURAL
DEVELOPMENT LOANS |
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The USDA's office of Rural Development (RD)
works with approved lenders
to guarantee loans to borrowers for single family homes in eligible
areas. The purpose is to provide financing – with no down payment, at
favorable fixed rates on a 30-year term. The reasons lenders choose to work
with RD are many. Since loan guarantees issued by RD are backed by the full
faith and credit of the U.S. Treasury, many lenders consider
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RD programs to
be relatively risk free. Also, loans made possible by partnerships between
RD and approved lenders improve the economic health of rural communities.
The continued well-being of rural areas provides more opportunities for
lending institutions that invest in these communities. |
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PROGRAM HIGHLIGHTS
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- No down payment. Provides 100%
loan-to-value financing for
existing homes based on appraised value. Homes must meet
Minimum
Home Requirements.
- Closing
Costs may be financed into the loan amount or paid by the seller up
to a maximum of 6% of the property's purchase price
- No monthly mortgage insurance
required. One time guarantee fee of 2.00% of the amount financed,
payable to Rural Development (RD) at closing, is significantly less
cost than FHA’s Mortgage Insurance Premium.
- Fully amortized 30-year fixed rate
loan. Click for
Rates and Costs
- Less up-front cash -to-close
requirements for this program than for conventionally insured or FHA
loans.
- No pre-payment penalty for paying off
your mortgage early.
- Taxes and homeowners insurance
included in your monthly payment.
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BORROWER
ELIGIBILITY REQUIREMENTS |
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- Do not own an adequate dwelling.
- Borrowers' adjusted household
income cannot exceed the maximum allowable income
limit per County.
**Click here for
OHIO
Income Limits
Have the legal capacity to incur the loan
obligation.
Will be the owner occupant.
Have acceptable credit history or middle credit
score over 620.
Allowed one 30 day late payment within the
last 12 months credit history or within the last 36 months rental
history.
A bankruptcy must be discharged at least 36
months.
Collections or judgments must be paid in full.
Have adequate and dependable available income.
PITI (Principal, Interest, Taxes, Insurance)
not to exceed 29% of gross monthly income.
Total debt payments not to exceed 41% of gross
monthly income.
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ELIGIBLE
AREAS |
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Homes
must be located in rural areas which include open country or communities
having a population not in excess of 10,000 or not in excess of 25,000
provided it is not part of a Metropolitan Statistical Area. Click for
OHIO
eligible areas |
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