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USDA (Purchase)

The U.S. Department of Agriculture’s Rural Housing Program offers low- and moderate-income households the opportunity to own adequate, modest, decent, safe and sanitary dwellings as their primary residence in eligible rural areas. Eligible suburban and rural homebuyers can use it for 100%, no-money down mortgage financing.

How it Works

USDA Rural Home Loans are provided through approved lenders and are designed for borrowers who purchase homes in communities of less than 20,000 people, or certain other USDA approved areas.

Benefits of USDA Rural Home Loans Include

  • Comparatively low mortgage rates
  • Loans up to 100% of property value
  • Reduced monthly mortgage insurance
  • Zero down payment required
  • Closing cost payment can come from any source
  • Easy qualification criteria
  • Not limited to first time homebuyers

What to Know

10 Ways to use a USDA Rural Home Loan:

  1. New or existing residential property to be used as a permanent residence. Closing cost and reasonable/customary expenses associated with the purchase may be included in the transaction
  2. A site with a new or existing dwelling
  3. Refinancing of eligible loans
  4. Special design features or permanently installed equipment to accommodate a household member who has a physical disability
  5. Reasonable and customary connection fees, assessments or the pro rata installment cost for utilities such as water, sewer, electricity and gas for which the buyer is liable
  6. A pro rata share of real estate taxes that is due and payable on the property at the time of loan closing. Funds can be used for the establishment of escrow accounts for real estate taxes and/or hazard and flood insurance premiums
  7. Essential household equipment such as wall-to-wall carpeting, ovens, ranges, refrigerators, washers, dryers, heating and cooling equipment as long as the equipment comes with the dwelling
  8. Purchasing and installing measures to promote energy efficiency (e.g. insulation, double-paned glass and solar panels)
  9. Installing fixed broadband service to the household as long as the equipment comes with the dwelling
  10. Site preparation costs, including grading, foundation plantings, seeding or sod installation, trees, walks, fences and driveways

Eligibility Requirements

Applicants must meet a series of eligibility requirements to be considered for USDA Rural Home Loans. Applicants must:

  • Meet income-eligibility (see Income Limits)
  • Agree to personally occupy the dwelling as their primary residence
  • Be a U.S. Citizen, U.S. non-citizen national or Qualified Alien
  • Have the legal capacity to incur the loan obligation
  • Have not been suspended or debarred from participation in federal programs
  • Demonstrate a willingness to meet credit obligations in a timely manner
  • Purchase a property that meets all program criteria

(According to USDA.gov)

Example:

Purchase Price
$250,000
APR
4.112
Down Payment
$0.00
Principle and interest payment
$1,110.22
Total Loan Amount
$255,102*
Monthly Mortgage Insurance
$105.32
Interest Rate
3.25% – 30 year fixed
Total Payment
$1,215.54**

 

(* inclusive of the USDA Guarantee Fee)
(** property taxes and home insurance would be in addition to this payment)

Why Blue Water Mortgage?
No Surprises
No Surprises
With over 150 years of collective experience, our mortgage brokers have seen it all. This level of expertise enables us to anticipate and quickly resolve any issues that might arise and close on time, every time.
Personalized Services
Personalized Services
Buying a home is one of the biggest purchases you’ll make in your entire life. That’s why our brokers are available via phone 24/7 to address any concerns or answer any questions you might have about the mortgage process.
Competitive Rates
Competitive Rates
Blue Water is locally owned, so we aren’t beholden to banks. That means we’re able to offer a more diverse portfolio of mortgage products tailored to your specific needs, as well as more competitive rates and lower closing costs.
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Frequently Asked Title

The Mortgage Process

Blue Water’s mortgage loan process timeline involves a series of five steps, some of which require sitting down with one of our experts to analyze all aspects of your financial health. Here’s what you can expect:
Getting to Know You & Getting On Track
In our first meeting, we’ll answer your questions and talk about the programs we offer that would best fit your situation.
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Getting Pre-Qualified
The next step in the mortgage loan process is applying for pre-qualification, which enables us to confidentially verify your credit, income, assets, and liabilities.
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Assessing Loan Programs & Rates
At this point, we’ll start to sort through and evaluate which mortgage best fits your needs.
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Obtaining Loan Approval
Once you’ve submitted your loan application, we’ll work with our lenders to help find you the best rate and most favorable terms possible.
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Closing the Loan
After your loan is approved, we’ll review the details once more to make sure you feel confident about the financial commitment you are about to make. Once all of your questions are answered, we will schedule a closing.
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Home Loan Resources

Worksheet

Use our Down Payment Worksheet to get a idea of what you can afford to spend.

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Checklist

Gathering the documents in this checklist will help speed up the application process.

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Property Rating Worksheet
Worksheet

Our Property Rating Worksheet has helped countless home buyers make the necessary comparisons to ensure they're making the right decision.

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Please be advised that your actual rate, payment, and cost could be higher. Get an official Loan Estimate before choosing a loan. This estimate is provided for informational purposes ONLY, to assist you in determining an estimate of cash that may be required to close and an estimate of your proposed monthly mortgage payment. Actual charges may be more or less, and your transaction may not involve a fee for every item listed.

Rate and APR based on the following assumptions: Purchase Price of $250,000, loan amount of $200,000, 80% loan to value, 740 credit score, single family property, primary residence, escrowing taxes and insurance, debt ratio within program guidelines.