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What are the differences in the USDA Guaranteed rural housing loan and the USDA Direct loans?

by ediemay30913 from Fort Smith, Arkansas. Mar 14th 2016 Reply


R. Jocelyn Anderson (labrokergirl)
#1247 ranked lender in California - 38 contributions

Direct Loan Program, assists low- and very-low-income applicants obtain decent, safe and sanitary housing in eligible rural areas by providing payment assistance to increase an applicant's repayment ability. Payment assistance is a type of subsidy that reduces the mortgage payment for a short time. The amount of assistance is determined by the adjusted family income.Single Family Housing Guaranteed Loan Program, assists approved lenders in providing low- and moderate-income households the opportunity to own adequate, modest, decent, safe and sanitary dwellings as their primary residence in eligible rural areas. Eligible applicants may build, rehabilitate, improve or relocate a dwelling in an eligible rural area. The program provides a 90% loan note guarantee to approved lenders in order to reduce the risk of extending 100% loans to eligible rural homebuyers.Please click http://www.rd.usda.gov/programs-services to obtain more information regarding these programs and contact your LOCAL Mortgage Broker for additional details. I hope this gave you an understanding regarding the program.

Mar 14th 2016
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Richard Airey (richardairey)
#3 ranked lender in Maine - 662 contributions

The USDA Guaranteed Rural Housing loan is offered through participating lenders. The USDA Direct loan is only offered directly through the USDA. For that loan, you would have to apply directly through your local USDA office. There are different guidelines relating to qualifying household income, credit rating, interest rates, as well as other underwriting guidelines. The USDA Guaranteed program allows a higher household income and more assets. It is also underwritten by the participating lender.

Mar 14th 2016
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Justin Murray (JustinMurray)
#102 ranked lender in Illinois - 172 contributions

Richard's response is dead on.

Mar 14th 2016
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Larry Gray (lgray_312_247)
#563 ranked lender in California - 1,127 contributions

Richard Airey pretty much answered you question, I think. I recommend you speak with a mortgage broker/banker licensed in Arkansas with experience in doing USDA Guaranteed loans and perhaps with someone in the nearest USDA office about their requirements. Often a mortgage broker can assist you in know the loan amount you qualify for, at what rate, monthly payment, and how quickly your loan might close.

Mar 14th 2016
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Lorne Harvey (lorneharvey)
#81 ranked lender in Washington - 419 contributions

Richard nailed it!

Mar 14th 2016
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Brian French (bfrench)
#1 ranked lender in Arkansas - 47 contributions

If you would like to discuss USDA Guaranteed Rural Housing loans, we are a local banker here in AR. bfrench@topflitefinancial.com or 501-276-6786.

Mar 22nd 2016
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