The USDA Loan is program sponsored by the Department of Agriculture. The USDA Rural Loan insures mortgages made by banks under this program across NY & PA, including Long Island, Nassau and Suffolk County.
In order to be eligible the property must be a residential home located in an area designated by USDA.
The USDA Loan allows you to finance up to 100% of the value of the home. No down payment is required. Similar to the VA loan, there is an upfront guarantee fee which is typically 2% but the USDA also carries an annual fee of .4%.
It’s similar to mortgage insurance but termed as a guarantee fee.
On December 1, 2014, USDA set a minimum credit score for a USDA home loan at 640. Before the change, USDA loans could be approved with scores of 620. You will need to fully document your income.
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The key aspect to this program is the location of the home.
It is designed for homes located in specially designated rural areas. If you are located in an area designated by the USDA across NY & PA you may be eligible for this product. Certainly, other qualifying aspects will come into play such as credit and income but it is a great loan option for those who fit the product.
— Jim Barry, CEO/President
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