USDA Loans

Diversified Home Loans, Logan Utah

NMLS #1494

What are USDA Loans?

Learn About The Advantages Of USDA Loans

USDA loans, also frequently referred to as Rural Development loans, are mortgages offered by the United States Department of Agriculture. These loans are designed to help low to moderate income individuals and families purchase homes in eligible rural and suburban areas. USDA loans offer attractive terms and benefits that make homeownership more accessible for those who meet the criteria.

No Down Payment

One of the most notable advantages of USDA loans is the option for a zero down payment. This means you can finance 100% of the home’s purchase price without having to make a down payment. It can be an excellent opportunity for individuals strapped for cash or those who prefer to keep it for other expenses.

Low Interest Rates

USDA loans often come with competitive interest rates, making them an attractive option for borrowers. Lower interest rates can result in lower monthly mortgage payments and potential long-term savings.

Flexible Credit Requirements

USDA loans have more lenient credit requirements compared to conventional loans. Even if you have a less-than-perfect credit score, you may still be eligible for a USDA loan. This can be a great option for individuals who are working on improving their credit.

Mortgage Insurance

USDA loans require mortgage insurance, but the premiums are typically lower compared to other loan types. This can help reduce your monthly payment and make homeownership more affordable.

Closing Costs

USDA loans allow borrowers to roll the closing costs into the loan amount, reducing the upfront expenses associated with buying a home. This can be beneficial for individuals who may not have enough funds to cover closing costs separately.

Let’s find out

Advantages

Important factors

Considerations

Geographic Restrictions

USDA loans are specifically designed for properties located in eligible rural and suburban areas. It’s essential to check the USDA eligibility map to ensure the property you are interested in qualifies for this loan program.

Income Limits

USDA loans have income limits based on the area’s median income. To be eligible, your household income cannot exceed the specified limit. These limits vary depending on the location and the number of people in your household.

Funding Availability

USDA loans are subject to funding availability. The USDA has a limited budget for these loans, and once the funds are exhausted, new loan applications may be put on hold until the next fiscal year.

Mortgage Insurance Premiums (MIP)

USDA loans require borrowers to pay an upfront guarantee fee at closing and an annual fee that is paid monthly. These fees help fund the USDA loan program but can add to the overall cost of the loan.

Expert Guidance, Personalized Service

Tailored Solutions for Your Homeownership

At Diversified Home Loans, we guide you through choosing the right loan for your homeownership journey. Contact us to explore your USDA loan options and take the first step towards owning your dream home!