USDA Direct NJ

[Anonymous]

Congrats! I'm having the application mailed to me for direct loan program, but have a question regarding credit scores. Do they use the scores you see when logging onto MyFICO on your dashboard or do they use the other score versions (i.e. Most common used in mortgage, credit card, auto loans, etc) that you can click on that tend to be lower than dashboard scores? Thanks!

[Anonymous]

It was the mortgage scores. Luckily ours were higher than the dashboard scores. Good luck!!

[Anonymous]

Oneup17- sorry I've been MIA! How's your process going?
We looked at around 25 houses and put in offers on about 5. Most were pretty low ball offers. The loan amount decreases depending on property taxes. With NJ being so high and varied from town to town it was hard to find what we wanted without an in ground pool and under 2000 sq ft. (We literally measured one that was just over to confirm)
So we are under contract with a house that fits our needs but it's about 15 mins away from our current area. We were approved for max amount of $220,200 but with taxes at $5800 the USDA rep told us we couldn't offer more than $206,000. That offer includes $6000 towards closing costs.
Inspection was done 2 weeks ago. Nothing major was found, just a few small requests. CO was done this past Tuesday and they are requiring alot more. Still waiting to hear if they are going to take care of it. It's an estate sale and executor lives 1000's of miles away. Supposed to close on 7/7. We'll see.

[Anonymous]

Hindsight - That's great news! Did the appraisal come back for you yet? We did find a home and are just waiting on the appraisal at this point. We've already received our funding commitment. We got approved for the max as well 292k. But we found a home for much lower that met our needs. There's not a lot of inventory here at all - So the pickings were slim! Our realtor only requested 5k in closing costs and prepaids and now I wish I would have pushed for more so we can get our inspection fee and first year of insurance back at closing. At the moment we're only set to get back about 1/4 of what we've paid. We don't have a closing date set, the contract just says on or before August 1.

[Anonymous]

I haven't heard if appraisal was done or not! Realtor said she contacted USDA rep on Monday about status but no reply as of Wednesday.
Usda rep actually told us closing costs would be around $6000 to ask for that if we wanted help with closing costs. Usda sent a closing estimate and it shows $8600! Some things were estimated higher than what we were quoted though. I hope it comes down alot because we don't have the extra!

[andrew232]

Congrats on your success thus far.

Question on interest rate subsidies. How often do they re-determine your interest rate subsidy? I know it's based on income increases. Is there a specific formula available to the public?

Thanks.

[Anonymous]

The USDA will redetermine the subsidy annually. The formula is available. You can find it in the handbook here https://www.rd.usda.gov/files/3550-1chapter06.pdf

[Anonymous]

We got word on Friday that the appraisal came back and it was fine. I haven't received a copy yet, I suppose I'll get something early this week! Hopefully those closing costs come down and they just overestimated. Did you get a funding commitment yet?

[Elaise]

I thought about making a new thread but i'll post here and see what it gets me. 

I will be qualifiing for a USDA Diect loan with a income of 27k annually. I also own about 3 acres free and clear with some buildings on it worth around 70k

My plan is to put a Modular home on this property. To my understanding a building will buy the land from me and then put a house on it and then sell it back to me. my question is. With the money I get from the property  will that hurt my chances on getting a loan through a USDA? Also I have done a rough estimate that the entire project will run me between 150-170k. When I add the land value it brings the property above the limit for my area.

[Anonymous]

Elaise- what type of buildings are on the property? I ask because USDA does not allow elaborate outbuildings. They do have a definition of modest in their handbook.

Also, how much money will you receive from selling? If you're over a certain age, they will allow you to keep your assets and not require you to use it towards your home purchase.

In addition, can the property be subdivided? USDA wants the land to be modest in size, but doesn't give a specific size maximum; but requires that it cannot be subdivided under local law.

Finally, there are ways around the area loan limit. I know my office told me they would allow me to go over the set loan limit/value if I could afford it and they have the funds available.