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Will USDA approve my guarenteed loan if bank has already approved?

by marybennet9 from Hickory, North Carolina. May 14th 2014 Reply


Jarrod McOmie (Jarrod)
#13 ranked lender in Utah - 120 contributions

Generally the answer is yes. Your bank should have Underwritten the loan to USDA guidelines. Once the file receives their Underwriters final approval, they send it to USDA for them to double check the file to ensure the banks Underwriter dotted the "I's" and crossed the "T's". At times USDA will come back with a couple of minor conditions for you/Underwriter to satisfy. Good luck!

May 14th 2014
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Ricardo Cobos (RicardoCobos)
#54 ranked lender in North Carolina - 10 contributions

The USDA doesn't make loans, therefore they don't make credit decisions, it's your lender that does that and it sounds as thought hey have already approved your loan. The USDA underwriting process is to determine eligibility which essentially focuses on three areas:1. Income; does the household income exceed the program limits?2. Are the applicant's debt to income ratios within program limits and if not, are there supporting compensating factors?3. Is the property eligible.?

May 14th 2014
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Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 4,296 contributions

Generally speaking, yes, USDA will OK the loan without any problems if the loan was properly underwritten to USDA rural development loan guidelines... But they can, and do sometimes ask for additional conditionals, or actually deny the loan. It doesn't happen often, but it can. In my 23-years of lending, I have only had one USDA loan denied by them after we approved it. For USDA loans in MN, WI, and SD - visit www.JoeMetzler.com/usda

May 15th 2014
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