USDA Rural Development home loans

posted 3 years ago in Home
Post # 2
Member
197 posts
Blushing bee
  • Wedding: August 2015

I have a USDA mortgage, what are your questions?

I wouldn’t recommend this route unless you plan on staying in the home you buy for a long time. 

  • This reply was modified 2 years, 9 months ago by  ceemarie7.
Post # 3
Member
545 posts
Busy bee
  • Wedding: November 2013

My husband and I are going through this process now—one thing to mention is that the USDA eligible areas are scheduled to change in October 2014 (this change has been scheduled many times and has continually been pushed back, so not sure if that will happen again or not). I know that in my state (MA), this is going to lead to MAJOR changes, with a large percentage of the currently eligible areas no longer being eligible, so you should look into that!

Post # 5
Member
10 posts
Newbee

 

MichiganGirl24:  While I don’t have any experience with USDA loans in particular, I would be very VERY surprised if they asked you to provide information to them after the loan was closed (not to mention raising your rates…that would be insane).

I’m a mortgage loan officer, by the way.

Post # 7
Hostess
8680 posts
Bumble Beekeeper
  • Wedding: October 2014

My step father’s mom has a USDA loan, and they do checkups on her yearly to go over how much she makes, and raise her mortage payment accordingly. She has been in her home for over 30 years, and she is still paying off interest on the home [which was only 60k] because her payments are so low. Because of this, she won’t have the home paid off before she dies.

Also, if you have someone living with you [who isn’t a minor], like a parent or room mate, what they make is factored into your total income, making your payment go up.

Post # 8
Member
545 posts
Busy bee
  • Wedding: November 2013

MichiganGirl24:  No one has said ANYTHING to us about checking in on our income and changing our payments or anything…and throughout the process it was clear that I’m a full time graduate student and working part time as an adjunct instructor (so it’s pretty obvious my salarly will likely change in the next couple of years), so I don’t think that happens.

Regarding what jenilynevette:  said….Obviously I don’t know the situation, but it’s possible that this bee’s stepdad’s mom is in a different situation because there are different types of USDA home loans. For example, there is a program for USDA Guaranteed Loans (where you work through a lender–this is what we have so I’m a little more familiar with this) and a separate program for USDA direct loans (where you work through the goverment—this one involves a lot more hoops to jump through, stricter requirements, etc.) This website has a little bit of info about both to get you started, I’m sure you can find a lot more with a quick search: http://www.usdaloans.com/lending-guide/direct-vs-guaranteed.html

You’ll see on that site that there is some info about which properties would qualify. One of the people we were working with said there was a max square footage a house could be, and he was concerned that ours was close to it….but no one ever mentioned that again or checked on it as far as I could tell, so maybe he was wrong and that is only true of the direct loans or something?

Good luck!!

Post # 11
Hostess
8680 posts
Bumble Beekeeper
  • Wedding: October 2014

MichiganGirl24:  As the PP said, there are probably different types of loans out there. I’m not sure what she has, but I know that they raise her payments based on what she’s making.

We had looked into getting a loan as well, and at the time, I had my brother and his gf living with me, because of this, it wasn’t affordable to us because it took all 4 of our incomes into play, and gave us a mortage payment higher than I’d be paying with a traditional lender. So that’s something to think about for the future.

Post # 12
Member
545 posts
Busy bee
  • Wedding: November 2013

MichiganGirl24:  That’s great! Definitely go with the guaranteed over the direct if you are eligible. I hope everything works out for you!

Post # 13
Member
2720 posts
Sugar bee

I looked into this but decided against it. Look at a credit union. We put 5% down at a 4.25% rate and our monthly payments will be better than it would have been using a 0% down USDA loan at 5.25%.

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