If you want to buy, repair, or renovate a home in a rural area, you might be eligible for a USDA loan. The United States Department of Agriculture backs these loans, which give moderate- and low-income people the opportunity to secure mortgages.
In addition, unlike other types of mortgage loans out there, you don’t have to put any money down with a USDA loan. You are eligible for up to 100 percent financing with these loans, so you don’t have to scrounge up your down payment before moving forward.
If you’re considering a USDA loan, you probably have a lot of questions. Let’s begin by determining if you qualify for a loan. Then, you’ll know if you should move forward with a USDA loan.
Do You Qualify?
If you want to secure a USDA mortgage, you have to meet certain requirements. Lenders use these requirements to weed out the applications and give money to the right people.
In order to qualify, you must:
- Choose a property located in an eligible rural area, there are many eligible areas in California.
- Have an income that doesn’t exceed 115 percent of the median income for your rural location.
- Possess a decent credit history.
- Be able to pay back the loan.