Everything You Need to Know About Oregon USDA Home Loans

As one of the few 100% financing options left available on the mortgage market today, USDA loans are an attractive option for the few potential homebuyers who are aware of this government sponsored mortgage program.

Once you have heard about the benefits of this unique loan program, you too will be asking yourself, what’s not to like about it. But before we go into all the great perks of getting an Oregon USDA mortgage, lets talk about who actually qualifies.

Qualifying for an Oregon USDA Home Loan

The United States Department of Agriculture created this loan to support rural development as well as provide financing options to low and very-low income earners in Oregon and across the United States.

Depending on the type of USDA loan you’re interested in obtaining financing under, you can have up to 115% of the median income in your county and still qualify for this low interest rate loan. For example, if you are a family of four living in the Eugene/Springfield area, you can make up to $74,750 per year and qualify under USDA guidelines.

There is not a hard and fast number that your credit score must meet to qualify for this type of loan. Your credit history and your income will be evaluated to determine your ability to meet repayment obligations.

Finding a USDA Approved direct lender for personal loans Home in Oregon

The name USDA loan can be somewhat deceiving because it would lead you to believe, you have to be in the middle of farming country to qualify. Not so. This program is offered to communities with populations of 20,000 or less. This means places like Wilsonville, Sherwood, Troutdale, Ashland, The Dalles and Pendleton all qualify for this loan among many more cities and towns throughout the state.

Not Just for First Time Homebuyers

If you already own a home, you can still obtain an Oregon USDA Home Loan, but there are some restrictions to qualifying. If your current residence is uninhabitable, your family has outgrown it, it is a manufactured home, or is not in fair commuting distance of your place of work, you can still qualify for this 100% financing loan!

Closing Cost Assistance

Oregon USDA Home Loans allow gifts from family and non-family members as well as seller closing cost assistance. This means you have the possibility of getting a USDA home loan with next to no out of pocket expense.

If you are interested in finding out if you qualify for an Oregon USDA Home Loan or speaking with one of our Oregon Mortgage Lenders about the various programs we have available, simply fill out our Fast Response form or give us a call in our local branch office located in Lake Oswego at (503) 840-6400. Our experienced mortgage professionals would love to sit down and discuss your needs. We look forward to hearing from you!

Here’s What You Need to Know About USDA Loans

The United States Department of Agriculture (USDA) loan program was designed to help improve the lives of those in rural America through homeownership. It all began in 1935 when President Roosevelt signed an executive order establishing the Resettlement Administration. This administration was particularly helpful during the Great Depression by providing aid to families and helping them relocate. Over time, this act was expanded to include the USDA Rural Development Department, which today administers USDA home loans.

Today, the USDA offers low-interest mortgages with zero percent down that are designed for Americans who live in rural areas and may not have the credit to qualify for a traditional mortgage. This program promotes economic development in areas that may not see significant growth otherwise. With this loan, borrowers with a credit score as low as 640 can qualify for a mortgage with interest rates as low as 1%.

Types of USDA Loans

There are actually two types of USDA loans, the USDA Single-Family Direct Loan and the Single-Family Guaranteed Loan. Both were created to boost homeownership in rural and suburban areas but are very different. The guaranteed loan is meant for low-to-moderate-income families and is the most popular. The direct loan is for very low-income families. The difference in these loans is how they are funded. With the direct loan, the USDA is the lender, while a guaranteed loan is generally obtained through an outside mortgage lender. Whichever route is taken, both loans are backed by the USDA.

Who’s Eligible

Many people may be surprised to find that they meet the standards to qualify for a USDA home loan. First, you must be a U.S. citizen or have been granted permanent residency. You’ll also need to provide proof of income. Also, your monthly mortgage payment must be 29% or less of your monthly income while the remainder of your monthly payments (credit cards, car payments, etc.) cannot exceed 41% of your income. Keep In mind that the higher debt ratios are considered if your credit score is above 680. While there are income limits to qualify for a USDA home loan, it varies by location and household size. You can find what the limits are for the county where you live here.

How to Apply

Once you’ve determined that you’re eligible, applying for a USDA loan is similar to any other type of loan. The first step is to find an approved lender and get prequalified. You’ll then want to find a USDA-approved home. Once you sign a purchase agreement, you’ll then go the processing and underwriting before closing.

We Can Help

The mortgage process can be difficult enough and we understand that the USDA loan process may seem overwhelming. However, finding a lender that is familiar with the intricate details and can help you navigate the process effectively can make all the difference. Silverton Mortgage is proud to offer USDA loans to those who qualify. Our experienced loan originators are prepared to answer all your questions to see if a USDA loan is right for you. Contact us today and see how we can help you discover the American dream of homeownership.