Why do my lender and my real estate agent disagree with USDA

[Anonymous]

I went and got my preapproval for  mortgage. The bank told me I qualify for a USDA loan which she felt was the best loan out there for first time home buyers. The way the lender made it sound, no pmi, no down payment, etc.. my wife and I were really excited about it. Then we met with our realtor and she said that she would discourage us as much as possible from a USDA loan because theres alot of "muck" you have to go through and for a first time home buyers that it can be quite taxing and frustrating. She really thought FHA was the way to go for us. Now my wife and I are confused and a little down about it. Can someone explain to us better why my real estate agent would feel this way and encourage us NOT to go with USDA and also do you think we she take her advice or go with the USDA anyways?

[mauve]

USDA Direct or Guaranteed?  I'd just scroll through this forum and look at any post about USDA for reasons to choose something else, but I think they're mostly about USDA Direct.

[Anonymous]

I didnt know there was different types of USDA

[mauve]

It sounds like you're talking about Guaranteed, btw, if you're talking to a bank. 

http://www.rurdev.usda.gov/LP_Subject_HousingAndCommunityAssistance.html

[oneilldn]

I'll get another realtor as she don't know what she's talking about....  If you got pre-approved from a bank for USDA, then it must be the Gurantee program (meaning USDA don't give you the loan, they just gurantee it). and in my personal opinion it is the best option outthere right now (make sure your income and property qualify).

I did USDA and the process went really easy and fast....

Good luck....

[Anonymous]

Well, oftent imes USDA takes longer and has a few more hoops.  ALso becuase they are limited in funding it is not uncommon for there to be delays in closing, etc.  This means the realtor may have a bit mreo work and yes, there can be some frustratin ont he buyers part.  Also, some sellers prefer not to do business with USDA loans becuase of the common delays.  That said, some sellers are the same with FHA.  This generally only comes into play with bank owned properties.  Some REO's  would rather stick to cash only or conventional lenders.  If they take an FHA or USDA offer they will want top dollar as oppossed to any discoutned cash offers or conventional loan buyers out there.

[Anonymous]

Most likely, your realtor had a bad experience with USDA and is holding it against the program.  IT still is the best out there if you and the property qualify.  That said, jsut keep in mind there may be an extra hurdle here and there, etc.  Sit down, explain the reasoning to the realtor, and if they have an issue seek another one.  Like I said, if I was a realtor and had a couple properties fall through due to USDA fairly regular funding problems as well as extra steps at time, I would probably not recommend them either, but ti does not mean that if a buyer made a decision about it I would not work with them over it.

[Anonymous]

I am just confused by what people mean as "hurdles". What are the qualifications for an USDA loan for it to go smoothly?

[MaisCher]

I went USDA guaranteed for my first home (closed Dec 2009 YAY) and all they required was a 620 minimum score and that I didn't go over the income limits...THAT WAS LITERALLY IT! Everything was submitted approved and I closed within a week. I built my house so that process took longer including some hurdles with my credit score, but the USDA portion was flawless. No pmi and I walked away from the title company with them owing me money back from my earnest deposit.

[Anonymous]

wow! im really wondering why my real estate agent is set against it. its really hard to find anything negative about it here on anywhere on the web