Buying a home without a down payment sounds too good to be true. However, USDA home loans have made it possible. They help potential homebuyers become proud homeowners. They have many benefits that most people are unaware of.
Benefits of USDA Home Loans
What is a USDA Home Loan?
A USDA Home Loan is a zero down payment mortgage loan for eligible rural and suburban homebuyers. The USDA loan program is backed by the United States Department of Agriculture (USDA). For eligible homebuyers, there are great benefits such as complete financing, no down payment, and below market mortgage rates.
Benefits of USDA Rural Home Loans
1. No Down Payment
The biggest problem for most first time home buyers is saving up the funds for a down payment. For USDA home loans, no down payment is required for eligible home buyers.
2. Low-Interest Rate
As USDA rural home loans are insured by the U.S. Department of Agriculture, borrowers are offered a low-interest rate that doesn’t vary based on the credit score or down payment, as a conventional loan would.
3. Private Mortgage Insurance
A home buyer is required to pay a monthly mortgage insurance that is the lowest of any loan program and it doesn’t change based on your down payment, as it does with the conventional loan.
4. Flexible Credit Guidelines
A USDA rural home loan is a government-backed loan that allows homebuyers with a bad credit history to qualify for home financing.
5. Finance Upfront PMI
USDA loans also require an upfront premium. The USDA allows the borrowers to include this fee into their financing and close on the loan without putting any money down.
Borrowers who want to finance with a USDA Rural Home Loan are subject to eligibility requirements, including income, credit, location, and property.
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