Rural home development loan options

rural home development - kiamie real estate

Rural locations have a lot of financing flexibility for qualified buyers.

USDA/RHS Rural Development Home Loan can provide an a great alternative to a conventional mortgage loan. Provided by the U.S. Department of Agriculture (USDA), USDA loans are mortgages guaranteed by the federal government. In fact, the overwhelming majority of the U.S. is eligible for USDA financing. Nearly one third of Americans live close to a property qualified for this program. Furthermore, this program includes single-family housing, multi-family housing, and community facilities programs.

Home buyers must qualify for the loan program

However, there are a few qualifiers for applicants to this program. As the loan name suggests, the home must be located within a rural location with no more than 35,000 existing residents. Additionally, home buyers must ineligible for a conventional mortgage loan. Furthermore, the property must be under 1800 square feet without an in-ground pool. Likewise, the rural property cannot be an income producing property. Most importantly, the USDA/RHS Rural Development Home Loan is primarily designed for low-to-moderate income borrowers who are U.S. citizens or have met eligibility requirements.

Here are a few of the many advantages of a rural home development loan:

  • 100% financing
  • No limit on seller contributions
  • Modular & manufactured homes may be eligible
  • No lot size restrictions
  • Gift funds allowed to cover closing costs
  • No pre-payment penalty
  • Good for purchase or refinance

The USDA loan process

Getting a USDA loan is very similar to a conventional or FHA loan. First, you will apply to a lender and get preapproval. Once you have received the letter of preapproval, you can begin looking for eligible properties and make an offer. Next, the lender will add your property information to your loan once you have selected a property. Finally, the lender will submit your loan to USDA for approval and the close will be closed.

To find out more about interest rates, forms, and other resources, visit USDA Rural Development.

Are you curious to calculate your monthly payments? Check out this USDA mortgage payment calculator.