USDA Rural Development Loans - DNJ Gateway Bank Mortgage

USDA Loans: Low Down Payment Mortgages for Rural Housing

If you are looking to purchase a home in a rural or suburban area and do not want to have a down payment, ask us about USDA Rural Development loans! With a USDA loan, 100% financing is available, making this loan program a good choice for buyers who do not have a lot of money saved for a down payment or closing costs.

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How Does a USDA Loan Work?

USDA (United States Department of Agriculture) loans are not just for farm properties! To encourage home buyers to populate up-and-coming neighborhoods, many suburban and ex-urban neighborhoods are USDA-eligible, meaning you can potentially buy your dream home with no money down. USDA loans have no maximum loan size, and they are available with both 30-year and 15-year fixed-rate terms. Rates for these loans are often lower than those on conventional mortgages, and refinancing a USDA loan is easy to do if rates fall even lower in the future.
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Does USDA Have Limitations?

There are both geographic and income limitations with USDA loans, but there is not a limit on loan amount (unlike FHA). USDA specifies certain geographic regions that are USDA-eligible, and your household’s income cannot exceed 115% of the area’s median income as defined by USDA. A DNJ loan officer can help you determine if you are both income-eligible and geographically eligible for a USDA loan. In addition to the above limitations, USDA loans may only be used for primary residences, and the buyer must meet credit and debt-to-income standards. The easiest way to know if you qualify for an USDA loan is to ask! At DNJ Gateway Bank Mortgage, we’re happy to analyze your unique situation and let you know if a USDA mortgage will be a good fit for you.
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Are There Any Fees Associated With a USDA Loan?

Yes – there is a 2% upfront mortgage insurance fee on both purchase and refinance transactions; the good news is that it can be rolled into your loan amount. This is a government loan, so the fees associated with the loan are put in place to keep the program alive and funded. For example, you may be buying a home for $100,000. The funding fee would be $2,000, so the amount you will be borrowing is $102,000. Additionally, USDA loans require a 0.40% annual mortgage insurance fee. This fee is paid monthly and is based on the remaining principal balance on the loan. If you’re interested in purchasing a home with money from an immediate family member, you’re in luck – the USDA allows the use of gift money.

Call DNJ Gateway Bank Mortgage to Learn More About USDA Loans

To discuss USDA loans with one of our knowledgeable loan officers, contact DNJ Mortgage today! We’ve earned the trust of homeowners in the Triangle, the Triad the Outer Banks, Western North Carolina, Virginia Beach, Rehoboth Beach, the Eastern Shore of Maryland, the Eastern Shore of Virginia, and more – Let us earn yours! DNJ also offers mortgages in Tennessee, South Carolina, Georgia, Texas, and Florida. Call today!