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Member
playedout
Posts: 13
Registered: ‎10-12-2011
0

My USDA Direct Loan Experience so far

[ Edited ]

Hello all,

 

I've been looking at buying a house for awhile, but only got serious about it recently.  I had a previous bankruptcy that was discharged in 2005 so for the longest time I was under the impression that that buying a house would not be a possibility until it fell off.  I learned about the USDA's direct program and learned that after reading the requirements that it sounded like it was possibility.  I thought about a conventional loan, but right now it's really hard for me to come up with a down payment right now so this is another reason why the USDA loan makes sense to me.

 

Credit:

 

I've worked hard to rebuild my credit and since my BK in 2005 my scores are in the 675 range.  I have 0 derogatory marks on my credit now - the only items that are impacting my score are I owe about $4000 on a credit card and $4300 on a personal loan.  I don't owe anything else.  (Car is paid off)  I make about $30,000 a year and do qualify for the low income limit for a direct loan.

 

Process so far:

 

Once I learned about the loan the USDA offers I drove to their office and talked with someone there.  I filled out a pre-qualification app and the nice lady there said everything looked good so she gave me an application to fill out.  Got everything filled out and sent it and FedEx'd to their office on Tuesday and according to a credit alert they pulled a report on Wednesday.  I did forget to include my W2's so I'm sure I will have to mail those in at some point.

 

Questions:

 

Since they've already pulled my credit already for the app I would assume that all the info I've sent them is good so far right?  Does that seem usually fast that they've already pulled my credit or is it normal?

 

She also did tell me about the situation with this year's budget being depleted and that 2013 hasn't been approved yet.  Has anyone heard any news about funding?

 

I'll keep everyone updated on my progress and edit this post as things change.

 

Timeframes:

 

9/14/12 - Preapproved in USDA office

 

9/16/12 - Application submitted and overnighted

 

10/18/12 - Received Certificate of Eligibility.

Established Member
Kg1977
Posts: 22
Registered: ‎09-03-2012
0

Re: My USDA Direct Loan Experience so far...and a couple questions.

Did you pay the fee for the credit report? I was told by my local office here in Ohio that funding probably won't happen until after the presidential election. Which would be after November.
Member
playedout
Posts: 13
Registered: ‎10-12-2011
0

Re: My USDA Direct Loan Experience so far...and a couple questions.

Yeah I already paid the fee - checked cashed and a copy of my credit report returned.  I'm not in a huge hurry to get approved - it will give me time to get some money saved up.

Member
playedout
Posts: 13
Registered: ‎10-12-2011
0

Re: My USDA Direct Loan Experience so far...and a couple questions.

[ Edited ]

Update:

 

Great news!

 

I called the USDA office today and they said my application looks positive.  They are working on verifying my income - my work uses The Work Number for verification...they didn't mention anything about having to contact The Work Number myself, they said chances are they would just use an average of my tax return and paystubs.  They said they would be getting in contact with me most likely next week to the next step in the process.

 

 

Member
playedout
Posts: 13
Registered: ‎10-12-2011
0

Re: My USDA Direct Loan Experience so far...and a couple questions.

Update...I received my certificate of eligibility in the mail today!  Time to go shopping.

Regular Contributor
jnkp2001
Posts: 135
Registered: ‎01-04-2012
0

Re: My USDA Direct Loan Experience so far...and a couple questions.

happy shopping!:smileyhappy:

FICO EQ: 633 8/15/12
lender pulled 11/3/12 EQ 661 TU 650 EX598
credit Karma 674 credit sesame: 663
B/K discharged 2/2006......closed 8/2012

May your limits be high and your balances low!

Member
playedout
Posts: 13
Registered: ‎10-12-2011
0

Re: My USDA Direct Loan Experience so far...and a couple questions.

Ok I have a question and want to see if anyone has an answer...I'm looking at a house that I'm really interested in putting an offer in for.  The house has been on the market for awhile and I had a chance to walk through it today - it was in pristine shape except for one issue.  The sellers decided to turn the basement into a 3rd bedroom which is currently under construction.  It appears the owner is a carpenter by trade and is doing the work himself.  Being the fact the house has been on the market for so long I have a strong feeling that the owners are motivated to sell fast and I would imagine that the work could be completed reletively quickly.  

 

As far as the USDA goes, since the 3rd room isn't actually completed yet I wonder if this would be an issue.  Or if there was something written in the contract that the build would be done by closing that it would be ok.  I'm close to pulling the trigger on this house, but I want to make sure this isn't going to be a problem.

 

Anyone have a guess?

 

I'll call the USDA office on Monday and also get an answer as well.

 

Established Member
Kg1977
Posts: 22
Registered: ‎09-03-2012
0

Re: My USDA Direct Loan Experience so far

I would put in the contract that you would like the 3rd bedroom completed before closing. So, say if there was an issue with it being incomplete, you wouldn't have to pay out of pocket yourself for the incomplete project. Just an idea. Will save you money in the end. In my experience so far, I am going to be buying a home that the sellers have agreed to fix any repairs before closing.
Established Member
Kg1977
Posts: 22
Registered: ‎09-03-2012
0

Re: My USDA Direct Loan Experience so far

Just make sure you have everything in writing. Good luck! :smileyhappy:)

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