Many home buyers in Kansas are unaware that the USDA (United States Department of Agriculture) offers a 100% home loan mortgages. The Kansas USDA rural mortgage program is another government sponsored home buying program. Similar to other mortgage programs like FHA and VA, USDA loans are processed through approved lenders, banks and brokers.
Some basic highlights of the Kansas USDA No Money Down Loan: Let’s discuss some of the benefits and obstacles of the USDA Rural Housing program below:
- $0 down, 100% Financing
- Single loan at a 30 Year low fixed interest rate
- Low monthly mortgage insurance (PMI) required
- No cash reserves required (money in the bank not required)
- Flexible credit requirements (like FHA, minimum: 620 credit score)
- Closing costs, home insurance and taxes escrow can be rolled into the loan, or paid by the home seller
- You are not required to be a first time home buyer
- No loan amount or purchase price limits
Obstacles of the USDA program:
- Single Family Homes only (can’t purchase duplexes, apartments, etc.)
- No mobile homes
- No “fixer-uppers” (standard homes in working order that meet basic HUD compliance)
- No “build on your own lot”
- Student loan debt – cannot be deferred
- Home must be located in a USDA approved location – see below
- Income for the household must be below the set county limit
USDA Location Restrictions:
USDA home loans are not for the “big cities”, but most surrounding areas qualify. If you qualify for a Kansas USDA mortgage, many times it can be a more attractive mortgage program than FHA Mortgages. The home ( any seller) must be located in a USDA approved are according to the map here. The house seller is not important, just where the house is “located”
Rather than having a loan limit, USDA has household income limits, which vary by county and household size. For most counties in Kansas the Max Household income limits are as follows:
- 1-4 Person Households $76,000
- 5-8 Person Households $100,000 +
Some common misconceptions of the USDA 502 Guaranteed Program:
- USDA loans are just for farmers – USDA Loans are not “just for farmers,” millions of home buyers from all walks of life already qualify.
- FHA or Conventional Loans are better – USDA home loans often offer better terms than an FHA or conventional loans. In addition, the mortgage insurance is cheaper.
- They are harder to get than FHA or Conventional Loans – This just isn’t true. In many cases, USDA Loans are actually easier to get because the loans are guaranteed by the government.
- USDA loans are not flexible – The truth is USDA loans can be used to buy a new home (located in a USDA approved area) or refinance to a lower rate (for homeowners that already have a USDA loan)
- Only certain people can qualify – Anyone who meets the income and credit guidelines can qualify for a USDA Rural Development loan.
- They are only for rural areas – Actually, USDA Loans are available in many areas that most people would not consider rural. For example, many small communities just outside of metropolitan areas qualify as rural areas according to the US Department of Agriculture.
Borrowers that have questions or what to learn more about getting pre-approved can submit the Quick Contact Form on the right side. You can also call ph: 800-743-7556 or visit www.UsdaMortgageHub.com. Mobile phone users can find the Quick Contact form at the top of their page.
Serving USDA buyers nationally including Kansas: Wichita, Overland Park, Kansas City, Topeka, Olathe, Lawrence, Shawnee, Manhattan, Lenexa, Salina, Hutchinson, Leavenworth, Leawood, Dodge City, Garden City, Emporia KS
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