USDA Rural Housing Programs

How do they Work?

Features and Benefits:

USDA Rural Housing Development Programs may mean for you:

1. No Down Payment Required

2. No Mortgage insurance needed

3. Easy qualification criteria

4. First time home buyers eligible

5. 30 year loan at a competitive fixed rate

USDA Rural Housing Program really helps 1st time buyers!

Program Requirements:

1. Individuals or home buyers must buy in a home in a rural area, ( I have seen small communities defined this way with small populations)

2. Applicants must have an income of up to 115% of the median income for the area

3. Families must be without adequate housing, but able to afford mortgage payments, including taxes and insurance

4. Applicants must have reasonable credit histories

Which Loan is BEST for me?

Question: You know there are lots of types of mortgages, how do I know which one is best for me?

Answer: You're right - there are many types of mortgages, and the more you know about them before you start, the better. Most people use a fixed-rate mortgage. In a fixed rate mortgage, your interest rate stays the same for the term of the mortgage, which normally is 30 years. The advantage of a fixed-rate mortgage is that you always know exactly how much your mortgage payment will be, and you can plan for it. Another kind of mortgage is an Adjustable Rate Mortgage (ARM).

With this kind of mortgage, your interest rate and monthly payments usually start lower than a fixed rate mortgage. But your rate and payment can change either up or down, as often as once or twice a year. The adjustment is tied to a financial index, such as the U.S. Treasury Securities index. The advantage of an ARM is that you may be able to afford a more expensive home because your initial interest rate will be lower. There are several government mortgage programs, including the Veteran's Administration's programs and the Department of Agriculture's programs. Most people have heard of FHA mortgages. FHA doesn't actually make loans.

Instead, it insures loans so that if buyers default for some reason, the lenders will get their money. This encourages tenders to give mortgages to people who might not otherwise qualify for a loan. Talk to your real estate broker about the various kinds of loans, before you begin shopping for a mortgage.

If you would like to a sample of data for USDA Rural Housing Progam requirements, clik on this link for Michigan.

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