The United States Department of Agriculture (USDA) recently made changes to their Rural Development Loan program that will take effect June 4, 2018.
Q: What is a USDA Rural Development Loan?
A: A USDA home loan is a zero down payment mortgage for eligible rural and suburban homebuyers. USDA loans are issued through the USDA loan program, also known as the USDA Rural Development Guaranteed Housing Loan Program, by the United States Department of Agriculture.
Q: What benefits does a USDA home loan have?
A: No down payment is required, flexible credit guidelines (minimum credit score of 620), bankruptcy is okay after three years, foreclosure is okay after three years, no maximum purchase price limit, closing costs can be financed in, competitive fixed 30-year interest rates, low monthly mortgage insurance, and it can be used to purchase existing homes, new construction or foreclosures.
Q: What changes did the USDA make to this loan program?
A: As of June 4, 2018, a large area in and around Wentzville will no longer be eligible for this loan.
Q: How do I know if the address I am interested in or if the area I want to build in is ineligible?
A: While only Rural Development can decide final determination for eligibility upon completion of a USDA loan application, the next best solution is to view the Proposed Ineligible Areas map provided by the USDA.