USDA Home Loan Credit Qualifications in NC

April 15, 2011 by 1 Comment

Good News!  You do NOT need perfect credit to qualify for a USDA Home Loan!  Whew!  This 100% no money down program requires a MINIMUM credit score of 580 – but folks, just because you have a 580 score, doesn’t mean you can purchase. These days – we normally need a score above 620 to get the loan approved by Underwriters.

If you are NEW to the Credit game, meaning you are recently out of school and don’t have any BAD credit, you just don’t have a TON of credit – we can probably get a 620 score approved. In general, you need 3 different trade lines with 12 months of payment history.  Equifax will verify your rental payments (assuming the lease was in your name) and calculate that as a trade line, the other 2 credit repositories will not.

Here are some guidelines on what USDA Home Loan Underwriters will NOT take:

  • Foreclosure within the last 36 months.
  • Bankruptcy within the last 36 months
  • More than one 30 day late in the past 12 months
  • Outstanding Judgments in the past 12 months
  • Two or More missed rent payments within the last 24 months
  • Chapter 13 Bankruptcy – Case by Case review
  • Delinquent tax liens
  • Delinquent student loans

If you are in the market for a new home, and you want to know if your credit will qualify you for a 100%, no money down mortgage loan with USDA Rural Development Mortgage Loan, call Steve and Eleanor Thorne – 919-694-5058 we are NC’s USDA Home Loan Experts!

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USDA Home Loan PMI Will Change 10/1/11

April 14, 2011 by Leave a Comment

If you are looking for a USDA Home Loan in North Carolina – you might want to do it before the end of September!  More Rule Changes! Okay, so you don’t HAVE to buy before October 1st.  It’s not like the 100% no money down program is going away – it’s just changing the way the PMI (which they call Guarantee Fee) is being charged.  Starting at the end of September, the  USDA Rural Guaranteed Loans will have an annual fee that is collected on a monthly basis. The upfront fee will be coming down as the guarantee fee is changed.

Currently, the guarantee fee for this loan is 3.5% of the loan amount which includes the guarantee fee, so it actually works out to about 3.63% of the net loan. If you are into algebra, the equation for that would be purchase price/.965-purchase price=guarantee fee.

The new PMI/guarantee fee will be 1% of the total loan amount plus a .3% annual fee. The calculations on this fee are a lot more complicated because it is calculated on the average yearly principal balance.   So, to do a simple back of the napkin calculation of what it will cost think about this:

$100,000 loan amount – add 1% for the upfront PMI fee.  So your monthly Principal and Interest payments are based upon $101,000.

On a monthly basis, you will be paying $25 a month for that original $100,000 loan during the first year… as your balance goes down, the amount you will be paying will diminish as well!

This will put USDA mortgage loans more in line with other low down payment programs.  However,  USDA Home Loans will still compare much better than FHA or Conventional loans due to the fact that the annual guarantee amount (the monthly payment) will be so low, and will be diminishing each year. In comparison,  FHA loans require a 3.5% down payment, and have an annual PMI (mortgage insurance) rate of .9%, three times what the guarantee fee will be with USDA home loans on a 100% down program.

If you have questions about USDA Home Loan Qualifications, Credit Score Requirements, or want to know what Counties Qualify for this program in North Carolina, Call Steve and Eleanor Thorne, NC’s USDA Home Loan Experts!  919-649-5058

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USDA Rural Development Switching Underwriters

July 12, 2010 by 2 Comments

USDA Rural Development Single Family Housing announced some consolidation and changes regarding WHERE files are going to be processed.

No matter who originates a USDA home loan, it is re-underwritten (or processed) through a local USDA office. In the past, loans for Wake County went to Wake, Johnston County went to Sanford and Franklin County went to Franklin County.

So, there will be an underwriter, or processor out there who in the next couple of weeks, won’t realize there’s been a change… will be going too fast without updating their rolodex, and they will ship a file off to the wrong place.  I can guarantee it.

If you are considering a USDA home loan for your purchase in NC, look at the following list of where files are being processed for your county.  Ask your loan officer… then call Steve Thone,Mortgage Banker in Cary , 919-649-5058.  We love USDA home loans!

In today’s announcement, USDA will be underwriting for Guaranteed Processing as follows:

Asheville Office -
Buncombe,Henderson,Madison,McDowell, Mitchell, Transylvania, Yancey County
Murphy Office
Cherokee, Clay, Graham, Haywood, Jackson, Macon, Swain
Shelby Sub Office
Cleveland, Gaston, Lincoln, Polk, Rutherford
Winston-Salem Office
Catawba, Forsyth, Iredell, Stokes,Surry, Yadkin
Jefferson Area Office
Alexander, Alleghany, Ashe, Avery,Burke, Caldwell, Watauga, Wilkes
Henderson Area Office
Alamance, Caswell, Durham, Granville, Orange, Person, Vance
Lumberton Area Office
Bladen, Brunswick, Columbus, Cumberland, Hoke, New Hanover, Pender, Robeson, Scotland
Greenville Area Office
Beaufort, Bertie, Camden, Chowan, Currituck, Dare, Gates, Hertford, Hyde, Martin, Northampton, Pasquotank, Perquimans, Pitt, Tyrrell, Washington
Asheboro Area Office
Cabarrus, Davidson, Davie, Guilford, Mecklenburg, Montgomery, Randolph, Rockingham, Rowan, Stanley, Union
Sanford Office
Chatham, Edgecombe, Harnett, Johnston, Lee, Nash, Wake, Wilson
Kinston Area Office
Carteret, Craven, Duplin, Greene, Jones, Lenoir, Onslow, Pamlico, Sampson, Wayne
Halifax Office
Franklin, Halifax, Warren
Rockingham Office
Anson, Moore, Richmond

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USDA Rural Development Home Loans

May 27, 2010 by Leave a Comment

Thinking about buying a home so you can get that Tax Credit? Don’t have a ton of CASH laying around??  Well, the first thing you should do is call Steve Thorne to see where properties are in your area that qualify for USDA Rural Development Home Loans!  Steve is a USDA Rural Housing Mortgage Expert, and he can research your property and determine if both you and the property will qualify! (okay so that’s the FAST way to do it – call 919-649-5058)

If you’ve heard that USDA Rural Development might be out of money… click here for an update!

If you’re a DIY kinda’ guy… then check the USDA web site to confirm the property eligibility and income limits for the subject property and area (you will see those links on the left navigation – remember you are doing a Guaranteed Loan – which means you have a higher Income threashold). In today’s shrinking credit market, USDA Rural Housing Loan Programs are one of the best 100% mortgage financing options in the marketplace. Give Steve Thorne a call today for more details.

USDA Rural Housing Loan Program Highlights:

  • Loans may be for up to 102% of the appraised value or sales price (whichever is lower). The 2% is for the Guarantee Fee, which is actually the only Default Insurance
  • No MONTHLY PMI (private mortgage insurance)
  • Secure, fixed-rate 30 year mortgages
  • Sellers can assist with paying the buyer’s closing costs
  • Little cash reserves needed for qualified borrowers (you’ll need money for your Homeowners / Fire Insurance Policy, and your taxes…)

Partial List of Eligibility Guidelines for USDA Rural Housing Mortgages

  • Homebuyers must be United States’ citizens, qualified aliens, or legally admitted to the U.S. for permanent residence.
  • Adjusted annual household income cannot exceed the moderate income limits for the area. A family’s size and child care considerations may increase chances for qualification if deductions are applicable.
  • Primary residences only
  • Home must be located in rural areas. This may include open country, and places with populations under 25,000 residents.

To find out more about Qualifying for a USDA Home Loan in NC, please click here.

If you want to find maps with areas that qualify for USDA Mortgage in and around the Triangle, Click Here.

Steve Thorne 919-649-5058, USDA Home Loan Expert.  We would love to help you buy your next home!

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Want the $8000 Tax Credit But No $ For Downpayment?

April 26, 2010 by 1 Comment

The $8000 First Time Home Buyer Tax Credit in 2010 expires at the end of this week, and people are really working hard to try and get in under the wire!

Tons of the people we are talking to do not have the money for a downpayment – and they are having trouble getting a Seller to accept a contract for USDA Home Loan… because the USDA Single Family Rural Development Home Loan Program is running out of money.

So what can you do if you don’t have a pile of money laying around for a down payment?

You can get a gift! You can file for the Tax Refund this year, even if you have already filed your taxes!  Get a gift from a Family Member!  Rob your 401K and pay it back!  Don’t let this opportunity pass!

Be careful not all purchases will qualify for the 2010 $8000 TAX Credit!

Here are some items to remember when you are trying to qualify for the credit:

  1. The home may not be acquired from a mother, father, spouse, or child
  2. The home may not be acquired from an entity in which you’re a majority owner
  3. The home may not be acquired by gift or inheritance
  4. The home’s primary buyer must be at least 18 years of age
  5. The home’s purchase price may not exceed $800,000
  6. The home must be meant for use as a primary residence

Remember – you must live in the property as your primary residence for at least THREE YEARS or you will owe Uncle Sam the refund. If you have other detailed questions about the CREDIT – look at the IRS Website.

We are still taking applications for folks who are writing contracts for USDA Home Loans. There’s still some money available – but it is going fast. If the seller will not accept a contract with USDA financing – consider FHA!  It’s a 3.5 down payment – and it CAN be a GIFT!

For answers to your questions about qualifying for a mortgage loan, contact Steve and Eleanor Thorne 919-649-5058. We have the best rates available and we lend all across North Carolina, Virginia, South Carolina, Georgia, Florida and Maryland.

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USDA Rural Development Home Loans – No Money?

April 15, 2010 by 2 Comments

As of 4/15/2010 USDA has less than 2.0 Billion dollars left to fund in home loans.  This is a HUGE issue for folks who waited until the last minute to purchase a home, thinking they could a) get a better deal and b) use USDA Home Loan financing (no money down).  At the current rate – we will be out of funds before May 1.

There are TWO major issues you should know if you are STILL wanting to write a contract and get your Tax Dollars.

  • It’s going to be HARD to get a seller to accept your contract.  It currently takes 2 weeks at USDA underwriting to get a loan approved.  So if you write your contract this weekend, even if we could get an appraisal in ONE DAY – they would be out of funds before you could get submitted!

But let’s assume that you get /or have a contract that’s accepted prior to the end of April… now you need to close by the end of June.  Here’s the rest of what you should know:

  • The National Association of Home Builders are going to Washington next week. They are NOT asking for an additional Tax Credit… they are asking for MORE USDA dollars.  You see, the way this deadline approached left many people feeling that they were going to change the guidelines for USDA Home Loans.  The NAHB is asking that they leave it in place with no guideline changes – because the default rates on these loans are LOW.

The Associated Press Said today:

Democratic Rep. Barney Frank of Massachusetts, chairman of the House Financial Services Committee, and four other members of his panel wrote letters to Agriculture Secretary Tom Vilsack last month supporting the program and proposing immediate funding options.

Waiting until the next fiscal year to replenish the program would mean shutting it down for five months. And proponents say that would hurt people who could not get a conventional mortgage.

We agree – and suggest that you contact your Senators and Legislators and ask them for more funds… we certainly have.

If you are in a contract or trying to get in a contract using USDA Home Loan Funds… call us.  We will give you straight answers, and work to solve your problems.  There are other solutions.  Steve and Eleanor Thorne, Mortgage Banker in Cary 919-649-5058

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