USDA Loan | Mortgage Investors Group

USDA Home Loan

You may be eligible for a no-down-payment loan through the USDA home-loan program if you meet income guidelines and buy in a designated rural area.

USDA home loans, sometimes called rural development loans, are government-insured mortgages that help buyers purchase a home with no down payment. Buyers may finance their closing costs into their loan or receive seller assistance for minimal out-of-pocket costs. USDA mortgages usually have very low fixed-interest rates.

The USDA home loan program was created in 1991 to improve homeownership rates in rural areas, although not all areas covered by the loan are necessarily rural. The program allows for purchases, refinances, renovations and repairs.

Benefits of a USDA Home Loan

  • 100 percent financing available with no down payment. The only other major mortgage program that offers this is the VA program.
  • Closing costs may be financed.
  • Credit requirements are more lenient than conventional mortgages.
  • Borrowers with prior credit issues, including prior bankruptcy or foreclosure may qualify.
  • Low, competitive fixed-interest rates.

USDA Home-Loan Requirements

You must meet the following requirements to be eligible for a USDA mortgage:

  • Home is located in a designated rural area.
  • Home will be a primary residence.
  • Principal, interest, taxes and insurance (PITI)  payment does not exceed 29 percent of gross monthly income.
  • Monthly debt and mortgage payment does not exceed 41 percent of gross monthly income.
  • Credit score of at least 600.
  • Minimum income guidelines depend on county, state, and family size.

You may choose one of two types of USDA home loans: a direct loan or a guaranteed loan. Direct loans are made by the USDA to low-income borrowers whose household income is less than 80 percent of the median income in the region. Guaranteed loans are made by a bank and offer a broader income range.

You can review household income limits here.


Types of USDA home loans - Mortgage Investors Group

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Mortgage Investors Group, based in Tennessee, offers residential financing in a number of states in the southeast, See MIG Service Areas. Terms and conditions to apply to home financing. We want to share with you the loan terms vary based on several characteristics and your financial profile. These include but are not limited to loan program, loan purpose, occupancy, credit history, credit score, assets, and other criteria per loan type. The repayment terms and interest rate may vary from time to time. The terms represented here are based on certain assumptions outlined below and/or noted on the loan outline page. Additional details concerning privacy, program disclosures, licensing specifics may be found at Legal Information.

MIG Loan Officers will help gather the information needed for an individual assessment to provide home financing which matches the loan characteristics with your home financing needs based on your financial profile, when you are ready to begin a full loan application. For estimates and general information before that step, the basis for which the mortgage financing information are as follows:
  • Rates are subject to change at any time.
  • Rate locks are available at current terms for 30 to 180 days based on program type, credit profile, property location, etc. which will affect the available rate and term.
  • Payments will vary based on program selection, current rates, property location, etc.
  • Not all programs are available in all states.
  • Some loan programs may not be available to first time home buyers.
  • Terms and conditions apply, which may include restrictions or limits per loan program.
  • Information is generally based on primary residence occupancy with no cash out when refinancing.
  • Unless otherwise stated, terms shown are estimates based in part on credit score of 700 or higher; owner occupancy, escrow account is established for taxes and insurance(s); debt-to-income ratio no higher than 43.0%; PMI applies to conventional loan programs over 80.0% LTV; VA,FHA & RD require insuring fees included in loan and/or payment; fixed rate, 30 year term.

An MIG Loan Officer is available to help with your financial details to determine which characteristics apply to your situation for a personalized look into which loan program best fits your home financing needs. Please use the Find a Loan Officer link or reach out to Mortgage Investors Group at 800-489-8910. Equal Housing Lender 1.2020