I am here to help clear this up and let you in on a loan product that is helping more people get in to homes these days due to the tightened guidelines of conventional loans. Meet the USDA (US Department of Agriculture) Rural Housing Loan that allows no down payment, no mortgage insurance, and great rates as well.

This is a loan product that has been around for many years, but not many people know about. The guidelines allow people buying owner occupied homes with 100% financing on a market rate 30-year fixed mortgage, with no mortgage insurance requirements. I know it sounds too good to be true, but this program does exist. However, you must be purchasing a home that is in an eligible area and your income must not exceed the moderate income guidelines set for the area in which you are purchasing.

The rural development loan program which is guaranteed by USDA is not eligible in highly populated areas like cities, and highly populated towns, but it is available in many small and mid size towns across the United States. This loan allows people who fit the guidelines to purchase a home with no money out of pocket. Closing costs may be rolled in, or the seller may pay all closing costs including taxes and insurance.

The USDA loan makes sense for even those who are putting money down on the home. With conventional financing, if less than twenty percent is put down, the loan would require mortgage insurance adding additional monthly expense to your loan payment. This is not the case with the USDA program. For people who qualify for this loan product, there is no better financing package. It even beats the popular FHA loan, because with the FHA there is a three and a half percent down payment and there is monthly mortgage insurance no matter how much of a down payment is put in the deal.

It would make sense to see if your gross income as well as the town or address of the property (if it is known) is eligible for the USDA program. Once you know the location and your income is qualified, the next step is to find a mortgage professional who has experience with the USDA loan. There are pit falls that can only be avoided with proper knowledge that comes from proper experience closing these types of loans. In order to have a smooth and stress free loan process, a proper package must be submitted to the right lenders who have experience underwriting the USDA loan program. I hope this information was helpful. Keep in mind that if one is qualified for this loan, there is no better loan product on the market.

The fixed rate mortgage has the following features: it provides savings for a long period, its rate of interest remains fixed for the entire period of loan, and its monthly payment of interest and principal remains fixed.

Adjustable rate mortgage (ARM) has the following features: interest rates are on the basis of index which changes according to the varying interest rates in the market, it begins with lower rate of interest, its monthly payments are lower than a fixed rate loan, it allows the borrower to get a loan with a larger amount, etc.

In the case of interest only home loans, monthly payment consists of the interest amount only, the principal is paid at the end of the loan period.

“No documentation loan” has the following features: the borrower need not disclose and document details such as job, source of income or assets. This loan is approved on the basis of the borrower’s credit worthiness.

“No income/no asset loan” is based on details of the borrower such as job and credit worthiness. There is no need to specify the particulars of assets and income.

“State income home loan” has the following features: there is no need of tax returns or other income documentation to process this loan.

The “federal housing administration (FHA) loan” provides insurance on home loans made by recognized lending institutions. FHA loan limits differ depending on the county where the assets are located.

I am here to help clear this up and let you in on a loan product that is helping more people get in to homes these days due to the tightened guidelines of conventional loans. Meet the USDA (US Department of Agriculture) Rural Housing Loan that allows no down payment, no mortgage insurance, and great rates as well.

This is a loan product that has been around for many years, but not many people know about. The guidelines allow people buying owner occupied homes with 100% financing on a market rate 30-year fixed mortgage, with no mortgage insurance requirements. I know it sounds too good to be true, but this program does exist. However, you must be purchasing a home that is in an eligible area and your income must not exceed the moderate income guidelines set for the area in which you are purchasing.

The rural development loan program which is guaranteed by USDA is not eligible in highly populated areas like cities, and highly populated towns, but it is available in many small and mid size towns across the United States. This loan allows people who fit the guidelines to purchase a home with no money out of pocket. Closing costs may be rolled in, or the seller may pay all closing costs including taxes and insurance.

The USDA loan makes sense for even those who are putting money down on the home. With conventional financing, if less than twenty percent is put down, the loan would require mortgage insurance adding additional monthly expense to your loan payment. This is not the case with the USDA program. For people who qualify for this loan product, there is no better financing package. It even beats the popular FHA loan, because with the FHA there is a three and a half percent down payment and there is monthly mortgage insurance no matter how much of a down payment is put in the deal.

It would make sense to see if your gross income as well as the town or address of the property (if it is known) is eligible for the USDA program. Once you know the location and your income is qualified, the next step is to find a mortgage professional who has experience with the USDA loan. There are pit falls that can only be avoided with proper knowledge that comes adequate experience of closure of these types of loans. In order to have smooth and stress free loan process, an appropriate package must be submitted to the creditors who have the right experience in the auspices of the USDA loan program. I hope this information was useful. Keep in mind that if someone is qualified for this loan, there is a better loan product on the market.