USDA - The 0% Down payment Loan Program

[Vinnie Da silva]

Considering that 92% of the United States land mass is USDA-eligible. More people should be taking advantage of the USDA program.

USDA > Is a Rural development loan program that offers a 0% down payment and low rates. It is one of the most cost-effective home-buying programs in the marketplace today. The qualification process is very similar to FHA and is easier than many other loan types since the program doesn't require a down payment or a high credit score. The borrower will need a credit score of at least 640. In some cases, the credit requirement could be as low as 581. Also, the borrower can roll the upfront fee into the loan or pay it out-of-pocket. Which can help low-income families get into a home.

Keep in mind that USDA home loans are designed for potential home buyers with low to moderate income. Therefore, the household income can NOT
surpass 115% of the area median income ( by county ). The USDA takes into consideration all the income of the household. Another great thing about this program is that allows borrowers to open a loan for the full amount of the appraised value, even if it’s more than the purchase price. Borrowers can use the excess funds for closing costs. For example, a home’s price is $100,000 but it appraises for $110,000. The borrower could open a loan for $110,000 and use the extra funds to finance closing costs. 

USDA Construction Loan > it is also possible to finance new construction with a USDA Construction Loan Program. Which combines the construction loan and a traditional 30-year fixed USDA loan into a single-close loan. This is one loan for the land, construction, and finished home. Different than some construction loans where you have 2 closings, one prior to construction and one after the property is completed. The best part is, no payments out of pocket during construction. 

I believe this is a great tool that realtors can take advantage of to grow and expand their business.  And for those who want to start investing in real estate, and don't have a lot of money saved.

> Here is the link where you can check USDA Eligibility ( https://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=sfp )

Please feel free to add any extra information or tips you might have.