What is a Guaranteed Rural Housing loan? The Rural Housing Service (RHS), an agency within the Rural Development mission area of the United States Department of Agriculture (USDA), guarantees home loans to assist eligible households in obtaining adequate housing in rural areas. The RHS guaranty reduces the risk to the lender, allowing lenders to lend at lower rates, more favorable terms, and under more lenient requirements for borrower credit-worthiness. To obtain the RHS guaranty, lenders must follow Guaranteed Rural Housing Loan program guidelines in assessing the credit-worthiness of the borrower and the value of the property. Loans made by approved lenders that satisfy the requirements for the RHS quaranty are called "Guaranteed Rural Housing loans". Because the Guaranteed Rural Housing loan program is one of many Rural Development programs offered by the USDA, Guaranteed Rural Housing loans are sometimes referred to as "Rural Develpment loans".
Is the Guaranteed Rural Housing loan a good choice for me? These loans are a good choice for eligible borrowers, with limited income and assets, who do not have the funds for a downpayment.
Guaranteed Rural Housing loan features:
- No downpayment required.
- No monthly mortgage insurance premium. There is a one-time "Guarantee Fee" of 2%, but no monthly mortgage insurance premium.
- Cash Reserves not Required.
- Closing costs can be financed into the loan. If the appraised value is higher than the sale price, then closing costs, prepaid expenses, and lender required repairs can be added to the loan amount up to the appraised value of the property.
- Flexible requirements for credit history. Approval is not based on credit scores, but on an underwriter's common sense judgement of your willingness and ability to pay. Borrowers with limited credit history will be considered, and non-traditional credit references may be used.
- Closing costs and prepaid expenses can be paid by the seller.
Eligibility for the Guaranteed Rural Housing loan program:
- Moderate income. Family income must not exceed the moderate income limits established by the RHS for the area in which the property is located. To find out if you are eligible under the income limits, call Allied Home Mortgage at 503-356-2241 or visit the USDA RD Loan Eligibility Website .
- Rural property. The property must be in an area designated as "rural" by the RHS. "Rural" designated areas may include small towns and cities as well as more obviously rural areas. To check whether a property is eligible for financing under the Rural Development program, call Allied Home Mortgage at 503-356-2241 or visit the USDA RD Loan Eligibility Website .
To qualify for a Guaranteed Rural Housing loan, borrowers must satisfy lender guidelines for income, assets, and credit.
For more information about the Guaranteed Rural Housing loan program, see the USDA pamphlet Guaranteed Rural Housing Loans, on the USDA website, visit the USDA Rurual Development Home Page, or contact Allied Home Mortgage.
To apply for a Guaranteed Rural Housing loan, fill out our short prequalification form, or submit an online application, or call us at 503-356-2241.
Allied Home Mortgage offers competitive rates, low fees, and superior service on hundreds of loan programs, including conventional, FHA, VA, and the USDA Guaranteed Rural Housing loan. At the Hillsboro, Oregon branch we are licensed to originate home loans throughout Oregon. We specialize in financing real estate purchase transactions, including manufactured homes. We also offer rate-and-term refinances, cash-out refinances, home equity loans, rehab loans, and reverse mortgages. We welcome applications from first-time homebuyers, borrowers with limited income and assets, and credit-challenged borrowers that have been turned down elsewhere. Click here for more information about us.
Allied Home Mortgage Capital Corporation
111 SE 3rd Ave, Suite C Hillsboro, Oregon 97123 503-356-2241 |
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