USDA Rural Development LenderSelect Mortgage Group USDA Rural Development

What is a Rural Development Mortgage? USDA Rural Development (RD) loans are a great financing option for: Low- to moderate-income borrowers Purchasing a modest primary residence Eligible rural areas

USDA Mortgage Guidelines Minimum 620 credit score Income limitations apply (115% of area median) Guarantee fee of 2.75% (may be financed) LTV up to 100% of APPRAISED VALUE (not sales price) Closing costs may be financed if appraisal comes in higher Guarantee fee may be financed up to 102% LTV

USDA Mortgage Guidelines Primary residences only Single-family New manufactured homes Excess acreage Cannot exceed 30% of total value (unless deemed typical of area) Cannot be subdivided 30-yr fixed loan Borrowers cannot own other properties

USDA Mortgage Guidelines Pest Inspection/Radon Only if contract or appraisal specifies needed Septic Inspection Well Inspection Always needed Private Road Maintenance Agreement

USDA Mortgage Benefits No down payment Not limited to first-time homebuyers 6% seller concessions allowed Gift funds allowed Low monthly mortgage insurance (MI) Low rates, comparable to government loans

Things to Remember Properties in flood zones are ineligible Property flips are ineligible Condos must be FHA-approved USDA must review a full loan package prior to closing, which may cause delays 1 - 7 weeks depending on USDA workload 60+ day contracts are highly recommended

How Can I Look Up Property Eligibility? Properties eligible for RD financing must be located in USDA-designated rural areas: http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do

How can LSMG help you and your borrowers with USDA?