Wenatchee Real Estate & USDA Home Loans

Dear Erin,
The other day I had someone suggest I look into a USDA home loan.  I know people who work at the USDA lab here in Wenatchee, doing research on fruit crops.   I didn't know they do home loans ! What is the USDA home loan program about?  Do we have to grow a food crop?  -Curious

Dear Curious,
No... you don't have to grow any crops! But DO NOT call the local research lab asking about home loans.  They will just say "Huh?" 

The USDA home loan program doesn't have anything to do with growing food.  There are some very specific qualifications, however. 

Here is an exerpt from the government website, outlining the USDA Home Loan program:

"A USDA home loan from the USDA loan program, also known as the USDA Rural Development Guaranteed Housing Loan Program, is a mortgage loan offered to rural property owners by the United States Department of Agriculture.

The mission of USDA Rural Development’s Single Family Housing Guaranteed Loan Program is to assist low to moderate income rural homebuyers achieve their dream of homeownership!
Rural Development partners with approved local lenders to extend 100% financing opportunities to eligible rural individuals and families for the purchase of safe and sanitary dwellings. Guaranteed loans have assisted thousands of homeowners to purchase a home with affordable interest rates and loan terms. 

Applicants must purchase a home within the eligible rural areas, and have a household income that does not exceed the established limits where the home is located. Additional Guaranteed Loan Features include but are not limited to: 

• 100% financing, no down payment is required. The loan amount may not exceed 100% of the appraised value, plus the guarantee fee may be included.
• Guarantee Fee applies: may be rolled into the loan amount.
• Flexible credit guidelines. Non-traditional credit histories may be accepted.
• Fixed 30 year interest rates apply. Lenders and applicants agree upon interest rate.
• Qualifying ratios are 29% for housing costs and 41% for total debt. Lenders may request an exception to exceed these ratios when strong compensating factors are identified.
• No maximum purchase price. Qualifying ratios and the applicant’s stable and dependable income will determine home affordability.
• Eligible property types include existing homes, new construction, modular homes, Planned Unit Developments (PUD’s), eligible condominiums and new manufactured homes.
• Eligible closing costs and lender fees may be included in the loan or paid by the applicant.
• Gift/Grant Funds/Mortgage Credit Certificates (MCC’s)/Seller Concessions are allowed.
• Eligible repairs and improvements may be included in the loan.
• Applicants apply with an approved lender of their choice.
• Not limited to first time homebuyers."

If you are interested in the USDA home loan program, there is currently eligibility in Chelan and Douglas County.  This eligibility changes, so you might want to check into it sooner rather than later.

Your REALTOR can help help guide you through the process, finding a qualifying home and USDA approved lender.  Your first step would be to find an approved lender to determine if you meet the borrower qualifications.  If you do, then you and your REALTOR can search for a home that meets the location qualifications for the program.

Good luck and let me know if I can help you!

Erin Davidson
Wenatchee Real Estate agent

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