USDA Direct Loan Question-Assets

[woozy]

I scrimped and saved to buy 10.00 nice rural acres. It can't be subdivided due to local ordinances and the deed, so the land falls within USDA parameters.

Now I want to get a USDA Direct Loan for a house. I seem to be eligible with both my credit score and income.

But...I'm afraid i may have screwed  up.

Is the USDA going to count the 10 acre homestead as an ASSET, thereby disqualifying me for a loan for the little house I want to build?

That is going to really bite if I can borrow money to buy 10 acres with a house, but I can't borrow for just the house.

[ShanetheMortgageMan]

No it won't be treated as a liquid asset, although on the balance sheet it will show the value of the land in the asset column.  No need to worry about owning the 10 acres, especially since that is where your home would be build that is being financed with USDA.

[woozy]

Shane, do non-liquid assets have an effect on approval?

TIA

[ShanetheMortgageMan]

It depends on what the non-liquid asset is.  Someone who has a vintage classic 73 Ferrari that is a family heirloom, or a baseball card collection, that wouldn't be an issue.  If someone has a car collection that would make Jay Leno jealous then there may be some concern that you aren't the type of individual USDA was designed for.

[woozy]

Thank you!