Oklahoma USDA Loan

It’s still possible for first-time home buyers in Oklahoma to purchase a home with NO money down in 2024. The USDA Rural Housing loan is government-backed and has secure fixed interest rates.  Many locations in Oklahoma are still eligible for this special 100% financing government mortgage program.

The USDA 502 Guaranteed loan has many advantages for buyers who have limited cash saved up for a down payment.  Let’s take a look at some benefits of USDA financing below. If you have questions, please reach out to us by calling ph: 800-743-7556 or just submit the quick contact form on this page.

Let’s look at some advantages of the 100% USDA home loan:

USDA advantages for OK home buyers:

• USDA is the only mortgage program today that allows Oklahoma home buyers to purchase with no down payment. Unless you have VA loan eligibility, USDA is the only option.
• 100% financing, plus USDA allows buyers to get their closing costs paid by the home seller or added to their loan under certain cases.
• The USDA home inspection and appraisal requirements are the same as the other loan programs today like FHA and conventional – no special requirements.
• Home buyers are NOT required to have a minimum amount of savings.
• Safe 30-year fix terms at low-interest rates with no early pay-off penalty worries.
• USDA loan applicants are NOT required to be first-time home buyers. You can be a move-up or second-time buyer.
• No USDA loan purchase limits – home buyers qualify based on their income and debt-to-income ratios.
• USDA Closing costs can be paid by the home seller, or included in the buyer’s loan in certain circumstances.
• Decreased monthly mortgage insurance. USDA requires monthly mortgage insurance costs each month like most home loans when the buyer is putting in less than a 20 percent down payment.  The benefit of USDA is the monthly PMI costs are much less when compared to other home loans like FHA, etc.
• Starting the process for a USDA loan doesn’t require any special class or down payment assistance. Buyers can get pre-approved for their USDA mortgage in minutes.

Important USDA loan eligibility requirements:    

• The property to be purchased must be located in a USDA Rural defined approved area in Oklahoma. In addition, the USDA program has income caps for the household. Please see all the USDA purchase FAQ’s here.
• Student loan debt – Student loan debt is not deferred when qualifying for a USDA loan. Because of this, USDA loan applicants with significant student loan debt may encounter obstacles in regard to debt-to-income ratio limits.
• Closing time frame – The USDA loan program is unique because the loan files are processed in two steps. First by the mortgage company, bank or broker originating the loan, then the file goes through a final review at the local USDA Oklahoma office. This means that USDA loans will take an additional week to close when compared to other loans.  Please note: USDA 502 Guaranteed loans can only be proceeded by approved mortgage companies, not directly by the USDA.  USDA only processes their “Direct” loan in-house. This program is set aside strictly for very low-income, subsidized housing. Also note, that USDA closing turn times do vary from state to state.

Oklahoma USDA Home Loan Eligibility

The USDA mortgage has a few important eligibility requirements that must be met in order to use the program.  Let’s take a closer look below.

• The location of the house: The house you decide to purchase must be located in a select rural approved area according to the USDA property map here. You can input the property address and check to see if the house resides in an eligible location. The home can be any single-family, townhome or select FHA-approved condo.  Mobile homes and manufactured homes are not allowed.  If you need assistance finding USDA-approved homes in your area, please contact us below.
• Your household income: The USDA Rural Development mortgage has income limits or “caps” in place. More importantly, the income caps apply to all income producers living in the house, even if they are NOT listed on the loan application. USDA limits vary based on the number of members living in the household, number of dependents, elderly, and county. Contact us below to discuss this in detail.

Oklahoma USDA Loan Application Requirements

USDA loans really aren’t that much different than other home loans like FHA, VA, etc.  USDA has standard qualifying guidelines that must be met. Let’s discuss the latest 2024 USDA guidelines below:

• Credit Fico Score – USDA lenders will want to see applicants have a 620 or greater credit score to be approved. However, a 620 credit score does not guarantee loan approval. All mortgage companies have additional requirements in place for applicants who have experienced a past financial hardship like foreclosure, short sale, or bankruptcy. These are called “overlays” For Example – if you have a 710 credit score but had a foreclosure 2 years ago, you would likely need to wait a few more years.
• Employment History-  Two years of stable income will likely be needed. You are not required to have the same job for two years, just a stable history. Example:  Let’s say you have been working as a fireman for 3 years. You recently left one fire department and started working at another. In addition, you took a few weeks off between jobs.  This is fine.  Or maybe you needed to take 3 weeks for hardship reasons – this likely would be okay as well.  Recent graduates are the exception to this rule as they do not need a solid two-year job history.  Self-employed borrowers will need two years of tax returns. Any part-time jobs will need two years of stable history to be included.
• Debt to income – Like all other home loan programs, USDA has debt-to-income ratio limits.  Borrowers can read more about this under the USDA eligibility section.
• A copy of the borrower’s bank statements will be needed during the approval process. Although USDA does not require a certain amount of savings, applicants will want to ensure they can document any deposit out of the ordinary.  Normal weekly, bi-weekly, or monthly payroll deposits are normal and to be expected. However, random deposits will be documented with a copy of the check and deposit slip. Gift funds are allowed with USDA loans, just be sure to keep a proper paper trail when it comes time to document. Additionally, the gift donor may be required to provide their bank statements as well. These requirements are not exclusive to USDA loans, they are essentially required on all government loans today.

Serving the entire U.S including Oklahoma:  Oklahoma City, Tulsa, Norman, Broken Arrow, Lawton, Edmond, Moore, Midwest City, Enid, Stillwater, Muskogee, Bartlesville, Shawnee, Owasso, Ponca City, Ardmore, Duncan, Yukon, Del City, Bixby, Sapulpa, Altus, Bethany, Sand Springs, Claremore, McAlester, Mustang, El Reno, Jenks, Ada, Chickasha, Durant, Tahlequah, Tahlequah, Miami, Okmulgee, Woodward, Elk City, Guymon, Choctaw, Weatherford, Glenpool, Guthrie, Warr Acres, Coweta. Oklahoma USDA First Time Buyer Program

USDA Mortgage Hub is Oklahoma’s leading source for USDA loans.  Buyers who have questions can submit the Quick Contact form on this page to speak with a specialist.