USDA Rural Development Loan Program
The Rural Development Loan is is $0.00 down, 100% financed,
no monthly MI/MIP and a 620 Minimum Credit Score. What this means to
you as the home buyer is:
$0.00 Down - No cash required for downpayment
1) The only cash you may need is for
your Earnest Money (which you provide to your realtor at the time your
Purchase Contract is accepted.)
2) Appraisal Fee (Fixed fee
of $500.00) collected at the time you have an accepted purchase contract.
These two items (earnest money + $500) will be refunded to you after closing
because they are included in your loan. So, if you had to pay $100
in Earnest Money and the fixed $500 for the appraisal, after you close
on the house, you would receive a check for $600.00.
100% Financed - All Closing Costs and prepaids can be financed into your loan (subject to satisfactory appraisal for desired loan amount).
No Monthly MI/MIP - MI stands for Mortgage Insurance.
MIP stands for Mortgage Insurance Premium. This is an Insurance
Policy that is required by the government for any loan program that has
a down payment of less than than 20% of the sale price. If
you were going with any other loan program you would be required to pay MIP. Because the USDA Loan Program is guaranteed by
the Department of Agriculture there is NO monthly MI/MIP.
USDA Funding Fee / Annual Fee - USDA does charge a funding fee for their guarantee, this funding fee is 2% of the total loan amount. USDA also charges an annual fee which
is included as a part of your monthly payment. This annual fee is 0.4% of the loan amount broken down monthly each year for the life of the loan.
620 Minimum Credit Score - While The United States Department
of Agriculture does not have a minimum credit score requirement for USDA Loans, all Investors currently have a 620 minimum credit score requirement.
For more information about this loan
(Refer to the "Loan Guarantee Program")
For Eligible areas in Ohio, Click
If you have any additional questions,
don't hesitate to call us at: 330-337-3260
Toll Free at: 866-920-9305
Fax us at: (330) 337-3266