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USDA does a lot more than just ‘grade’ beef.  And yes, we do originate USDA home loans. One primary concern is that Congress has to approve allotted funds to the program, they just did for 2010. But with any program once the money runs out, we have to wait for the next approval of funds.  Currently, Windsor, Healdsburg, Cloverdale, Sebastopol, and Russian River all fit as qualifying locations...

There has been a lot of buzz in offices for alternative financing. One alternative is a USDA loan. Yes, the USDA does a lot more than just ‘grade’ beef. And yes, we do originate USDA home loans. One primary concern is that Congress has to approve allotted funds to the program, they just did for 2010. But with any program once the money runs out, we have to wait for the next approval of funds.

Currently, Windsor, Healdsburg, Cloverdale, Sebastopol, and Russian River all fit as qualifying locations.

 The Good

• 0 down payment, up to 102% LTV of the appraised value
• Manufactured homes allowed but…..       Must be new and purchased, installed and warranted from an Agency approved Dealer-Contractor. Please contact the local Rural Development office for a list of Agency approved Dealer-Contractors
• Credit score as low as 600…..Additional credit requirements apply if under 620
• Doesn’t have to be a farm or anything like that, just in the approved USDA area.
• 4% seller credits
• No PMI
• Gifts are allowed

Needed to Qualify

• Income limits
• $417,000 max loan
• 2% USDA guarantee fee on each loan (may be financed)
• Must be in a USDA approved area
• Once we pre approve you and put together a package, USDA has to approve. May take up to 3 days.
• Strict 29/41 debt ratio’s. That means that your clients complete house payment should not be more than 29% of their gross monthly income, and that their house payment and other monthly credit debt should not be more than 41% of their gross monthly income.
• Appraisals to be done by FHA appraisers using FHA standards
• Income producing properties not allowed
• Owner occupied 1 unit properties, condos and PUD’s 

Attached is a link to the USDA website. There you can find income limitations and approved areas and more information.  

http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?NavKey=home@1

 

Steve Guenza

Mortgage Advisor

Century 21 Mortgage

 707-765-4453 office

707-326-0814 cell