USDA Home Loans in NC are one of the best programs, especially for First Time Home Buyers, because it’s fairly easy to qualify for a USDA Loan. The property must be within the USDA Eligible Area Map footprint, and you must not be over the USDA Income Limits for the County you are purchasing in… other than that, the USDA Minimum Credit Score Profile that the NC Underwriter is looking for at least 12 months of Clean Credit.
USDA Loans NC Eligibility: USDA Minimum Credit Score
Frankly, the USDA Loans in NC minimum credit score requirements, are a little tighter. Which is totally understandable, because you are not required to make a down payment. Other mortgage programs have different credit score guidelines.
“Clean Credit” is a slang term used OFTEN in mortgage lending.
It refers most often to someone who has 12 months with no late payments. But it’s not just late payments, it also refers to 12 months with no new collections filed against you. 12 months with no judgments of liens filed on your credit report.
12 months with no one writing anything to your credit report except GOOD STUFF. If you had some late payments on a couple of credit cards in the middle of 2006… and then you hit another rough patch in 2008, and then AGAIN in 2010 and 2011… we refer to that as “sloppy” credit.
You could still have a credit score of 620 – but it shows a history of not paying on time. For THIS type of borrower – the underwriter might need to see 18 to 24 months of CLEAN CREDIT!
Additionally, the Automated Underwriting System is going to ask for a minimum Credit Score of 640. So, if you have two of your three credit scores under 640, and want a USDA Home Loan, we have to meet Debt to Income Ratio requirements as well. We can go down to 620 on a USDA Home Loan NC, but it needs to be a really strong loan profile.
USDA Eligible Area Maps NC
The program requires that you purchase a home located within the USDA Home Loan “footprint.” In NC that “footprint” is scheduled to change pretty significantly when Congress finally passes a new Budget (which could be in 2014??). The change was originally scheduled to take place with the USDA Eligible Area Maps NC in March of 2013 – then it was delayed until September 30th… and as Congress does not appear to be much closer to passing a Budget (or the Farm Bill) right now, it appears that the USDA Eligible Area Maps for NC will likely not change until later in 2014 or 2015.
The changes are significant as over 22 Communities and small towns will lose the ability to offer this program for home buyers. USDA is a NO Down Payment Required program, with very low PMI charges, when compared to Conventional or FHA loans.
We put together a pretty comprehensive look at the CURRENT USDA Eligible Area Maps in NC, and then compared them to the FUTURE map changes. WHENEVER they change, we believe it’s important to know if the area you are interested in will be affected.
If you are new to the credit game – or if you want to see if your credit score is “big” enough to buy a house using the USDA Home Loans NC Program – call Steve and Eleanor Thorne, 919-649-5058. We are NC’s USDA Home Loan Experts, and we understand all of the USDA Minimum Credit Score Requirements! Remember, just disputing everything on your credit report is probably not going to work.