USDA Guaranteed Mortgage Loan Program
The USDA mortgage loan is the only mortgage left that offers home buyers a mortgage with 100% financing. The USDA mortgage loan program requires the borrower to meet income limits and the property has to be in a designated rural area. The borrower can also use a seller concession towards closing costs up to 6% of the purchase price.
The USDA mortgage loan is very similar to the FHA mortgage. It uses the FHA handbook for it’s appraisal guidelines and many of the USDA borrower guidelines are very similar to FHA.
The are some differences between the USDA mortgage loan and the FHA mortgage loan. The USDA mortgage has mortgage insurance that is less expensive compared to FHA. Plus, a borrower needs a minimum 3.5% down payment with FHA. The interest rates on both mortgage loan programs are very similar.
Contact a loan officer to find out more about the USDA mortgage loan program and how it may be a benefit for you if you’re in the market to purchase a house.