USDA Direct property waivers

daisyday922 · ‎03-09-2014

Okay, I am going the USDA DIRECT route, full application submitted last week. I have already starting looking at houses and they are still scarce right now, but I found one that is 3 acres of land and has 2300 sq feet. It is just myself and my daughter but it really doesn't feel that big once inside (older farmhouse). I am unsure if this is too big for the usda direct and if it was, if there are waivers that anyone else has had luck with? The property currently is a full 18 acres for sale but the other 15 is farmland, the seller is willing to survey off just the yard, I'm not sure if I can go less than 3 acres with this area. I'm in Indiana and have "heard" 2000 sq feet max and 2 acres or less. There really isn't much out there that meets that right now so I'm worried. Anyone had experience with this anywhere? Thanks~

DanTheMan77 · ‎03-10-2014

In my state, the property can't be subdividable (it has to be less than twice the minimum lot size) and the house has to be under 2,000 sq. ft. The lot also can't have any farm buildings on it. I haven't heard of anyone getting a waiver on the lot size. It is possible to get a waiver for the sq. ft. of the house, but you have to prove that there is a legitimate reason you need a larger home (ie. large family, disabled resident). I doubt that the USDA would approve a waiver based on your family size, but the only way to know for sure is to call your office and ask them.

rideswithchrist1 · ‎03-14-2014

I would like to know too- we found a house under the Sq footage, but it is .07 over the 1 acre limit.

I emailed my local office, I will see what they say and post.

DanTheMan77 · ‎03-14-2014

These are the regulations straight from the USDA regarding the site. Any questions about how to interpret them should be directed to your local office. There is no specific lot size requirement, just that it can't be subdivided based on local zoning. There is no waiver for lot size... it either can or can't be subdivided. If the minimum lot size per local zoning is one-half acre, the lot could be 0.9999 acres and you'd be fine but if it was 1.0001 acres it wouldn't be allowed.

5.4 MODEST SITES

Modest sites are defined by their size, value, and the presence of any outbuildings. Therefore, the Loan Originator must verify that the requirements listed below are met.

Size: The site must not be large enough to be subdivided under local subdivision regulations.

Value: The value of the site should not exceed 30 percent of the as-improved market value of the property. The 30 percent limitation may be exceeded if the site cannot be subdivided into two or more sites and the value of the site is typical for the area, as evidenced by the appraisal and the practices of other lenders.

Farm Buildings: The property must not include farm service buildings; however smaller outbuildings such as storage sheds are allowed.

rideswithchrist1 · ‎03-17-2014

Since the home was modest, 1700 sq ft, they were going to waive the .07 overage on the lot.

BUT my realtor discovered that home needed 10K worth of foudation repair. That one is out too.

So far- there is 1 home on the market in our price range and I HATE the lay out and the yard is a corner lot (which means the lot has been eaten up in the front and there is no back yard at all)

10 days down...35 more before we have to ask for an extension.