The Lakeland USDA home loan has become a great resource for many first-time home buyers in recent years. USDA Rural mortgages offer several benefits, keeping in mind the limited savings most first-time buyers have. The USDA 502 Guaranteed program allows buyers to purchase with $0 money down – in fact, this is the only 100% home loan available in Polk County unless you are a home buyer with VA loan eligibility.
We listed a breakdown of the USDA program. Please contact us at ph: 800-743-7556 with questions.
- 100% financing – The Federal government backs USDA loans, and allows 100% financing as a way to help develop and expand rural locations in Polk County. The USDA mortgage also allows for the seller of the home to pay the buyer’s closing costs, up to 6%. With that home buyers can generally close on a home with little to NO money out of pocket.
- Loan qualifying is simple – Getting qualified and approved for a USDA loan is quick and easy. Often times the entire pre-approval process can be completed in 20 minutes. There is no special requirements like first-time buyers class, grants, or special education that are needed to apply. Buyers just need to ensure they have decent credit scores (over 620) and income below the max limit set for Polk County. Contact us to discuss USDA income limits in more detail.
- Approved Locations – The USDA 502 Guaranteed program is only for certain rural locations in Polk County. The good news is most of Polk County just outside of Lakeland and Winter Haven is still approved for USDA financing.
- Secure interest rate– One of the benefits of the USDA loan is the fixed 30-year interest rate. Compared to other traditional loans where the interest rates can vary or adjust, the interest rate remains the same for the entire course of the loan. No pre-payment penalty or adjustable rate (ARM) terms. Home buyers can sell their home or refinance anytime without restriction.
- No savings requirement – Home buyers are not required to have a certain about of saving to be approved. Most conventional loans require large down payments and savings reserves for buyers to get approved, but not the USDA program. Buyers can also receive gift funds if they choose to put money down or help pay USDA closing cost expenses.
USDA mortgage applicants need to know what to expect before starting the approval process. Knowing what to expect will always help your chances of successfully getting your USDA loan approved. Below we have listed some things to consider :
Borrowers will need a credit score of 620 or better, however, a 620 credit score does not automatically guarantee loan acceptance. For buyers that have experienced a recent bankruptcy or foreclosure (financial hardship), you would need to have maintained perfect credit for (3-4 years) regardless of your current credit score.
It’s usually little things that can hurt your credit. If you think your credit needs some work, check it out in advance before you make an application. Keep in mind, your interest rate is tied to your credit score. Buyers with the highest credit scores generally receive the lowest interest rate. This is important because it can save buyers thousands over the life of their loan.
Employment and debt/income ratio
A solid review of buyer’s debt must be done by lenders to insure the buyer can meet the obligation. Banks and lenders don’t want to see a total debt load that’s higher than 42 percent for a USDA mortgage approval. Buyers will also need two years of consistent employment with unexplained gaps in job history. Changing employers within two years in the same line of work is perfectly ok.
USDA Rural Development Loan Process:
- A full application will have to be filled out that detail everything about you which will be used in figuring out whether you’re eligible for the USDA loan. The rate and the terms of the loan will also be determined largely by the information in your application and credit score. The complete USDA application process takes about 20 minutes to complete. In the event the application is pre-approved, and you go under contract to purchase a home, you will get the disclosure documents which are essentially mortgage disclosures that have all the fine details regarding the terms, interest rates, cost and payments of the loan.
- The mortgage disclosures are to be signed and returned along with other documents such as your bank statements, driver’s license, and employment pay stubs, for verification purposes. Normally these documents are prepped and readied well before the loan application is submitted to the lender or bank.
- The mortgage company processor will review and verify all documents and requests for missing or any additional documents from the borrower if need be. Upon completion, the documents are then submitted to the underwriter for review.
- The underwriter will send a loan conditions list detailing any additional information or documents needed from the applicant.
- Once the applicant satisfies the needed items on the list, the file is sent back to the mortgage company for final approval. After this the closing is set up with the title agent, buyer and seller. The USDA closing time in Florida is approximately 35 days from start to closing.
Learn more about USDA loans by calling ph: 800-743-7556 or just submit the Quick Contact form at the top of this page. Proud to serve home buyers across the U.S. including Lakeland FL, Auburndale, Bartow, Davenport, Dundee, Eagle Lake, Fedhaven, Fort Meade, Frostproof, Haines City, Highland Park, Lake Alfred, Lake Hamilton, Lake Wales, Lakeland, Mulberry, Polk City, Providence and Winter Haven