Alabama Rural Housing loans offer a way for first-time home buyers to purchase a home with no down payment. The truth is home buyers just don’t have a lot of options to purchase a home with zero down payment. In fact VA and USDA are the only government loan options in 2016 that allow Alabama buyers to purchase a home with $0 cash down.
The USDA home loan program offers many advantages that you won’t find in an FHA loan or traditional “conventional” mortgage program. A few of these advantages include low monthly mortgage insurance, 100% financing, and no asset or reserve requirement.
That’s right, the USDA loan is one of the only remaining mortgage programs in the country that require absolutely no down payment for the purchase of a home. In addition, the USDA home loan program allows for closing costs to be either paid by the seller in full or permitted to be accumulated or “rolled into” the total amount of the loan if the home appraisal is high enough. This allows buyers to need very little money upfront to buy your home.
The USDA 502 Guaranteed loan is available to all home buyers purchasing in eligible locations throughout Alabama. The program is not reserved exclusively for first-time home buyers. Even better, buyers are not required to take any special class to get approved. Complete a loan application and search for a home all on the same day!
In order to qualify for a USDA Rural home loan, applicants must meet the basic lender USDA loan eligibility requirements below.
- The property must be located in an area that is designated as “rural” by the USDA. Many popular locations across Alabama still qualify
- The program is available for purchase transactions only (no investment properties or vacation home purchases)
- Available for 1st Time Buyers or Repeat Buyers (Buyer cannot own another home at the time of purchase)
- 620 credit score is required to obtain approval
- Buyer income is limited to a maximum of 115% of the area’s median income. Contact us below to discuss the USDA income limits in your county.
- The entire purchase price (including the upfront USDA Guarantee Fee) can be financed (100% financing, no down payment required)
- The seller or lender can contribute up to 6% of the sales price toward the home buyer’s USDA closing costs
- Single-family homes only (no manufactured housing)
- Secure 30-year fixed loan term
- W2 income or self-employed is allowed (income and employment must be fully documented)
- Gifts for closing costs or down payment (if desired) are permitted
USDA Mortgage Hub serves home buyers across Alabama 7 days a week. Borrowers that have questions or what to learn more about getting pre-approved can submit the Quick Contact Form on the right side. Mobile phone users can find the Quick Contact form at the top of their page. You can also call ph: 800-743-7556
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