usda loan

[Anonymous]

 I was wondering why the USDA has an interview with the loan process. I took everything in and gave the check to them for the credit report. He said everything was in order and that they had everything they needed. My husband is the only one on the app because I am a full time student and my scores are lower than his. Could they just need to talk to him to verify things on the application? I had a tri merge from a bank from a week and a half ago. We went over that together. Just curious about the interview. Is it a good sign when they want you to come in for one? Some people sound like an interview wasn't in their application process. Thanks

[Anonymous]

Brand new to the forums, so please excuse all my questions!

What exactly is the difference between the USDA Direct and USDA Guaranteed. Loan? 

Also, my mid score is 574 with errors reporting that are currently being disputed and I have 2 lates in past 12 months.  My income consistantly is some w-2, 1099 MISC and self employment with very strong (5 year) history verified this by Tax Returns.  My income seems in the moderate category for USDA standards for my area.  Small debt, $399 car payment, no cc debt or other.  Found a new home that is a builder foreclosure and it is listed about 60% of value, unfinished and sold as is. 

Will the house and I qualify for either of these programs? If so, we will have to go through manual underwriting?

It is such a great house, great value and I am so tired of flushing money in rent!

[pmarti8]

I know this post is old but I will still respond for the benefit of anyone else who might have the same questions.

"What exactly is the difference between the USDA Direct and USDA Guaranteed. Loan?"

- The Direct loan comes directly from the USDA  office meaning they are your loan originator.  The Guaranteed Loan is financed by a traditional financial institution the USDA just guarantees the loan should you default.  

"Also, my mid score is 574 with errors reporting that are currently being disputed and I have 2 lates in past 12 months.  My income consistently is some w-2, 1099 MISC and self employment with very strong (5 year) history verified this by Tax Returns."

- You should wait to apply after you've corrected the errors and when your mid-score is a minimum of 620.  I would suggest  640.  The USDA does not like to see any lates within the past 12 months but will do a streamlined process and not fine tooth the credit report if the mid score is 640 or above.

"My income seems in the moderate category for USDA standards for my area.  Small debt, $399 car payment, no cc debt or other.  Found a new home that is a builder foreclosure and it is listed about 60% of value, unfinished and sold as is. "

-The home will need to pass the standard HUD home inspection criteria before approval.  I would look up what those requirements are and make sure your home will pass.

"Will the house and I qualify for either of these programs? If so, we will have to go through manual underwriting?"

-With a mid-score of 574 and two lates in the last 12 months you will most assuredly go through manual underwriting. You will have to have strong compensating factors: steady work history, a history of savings, and proof that your lates were the result of a substantial out of the ordinary  occurrence not likely  to happen again.

"It is such a great house, great value and I am so tired of flushing money in rent!"

- It sounds like a great deal.  See if you can goodwill your creditor into removing those lates and work quickly and diligently to get those errors off and you should see your score substantially rise.  Good luck.

[pmarti8]

"What exactly is the difference between the USDA Direct and USDA Guaranteed. Loan?"

- The Direct loan comes directly from the USDA  office meaning they are your loan originator.  The Guaranteed Loan is financed by a traditional financial institution the USDA just guarantees the loan should you default.  

"Also, my mid score is 574 with errors reporting that are currently being disputed and I have 2 lates in past 12 months.  My income consistently is some w-2, 1099 MISC and self employment with very strong (5 year) history verified this by Tax Returns."

- You should wait to apply after you've corrected the errors and when your mid-score is a minimum of 620.  I would suggest  640.  The USDA does not like to see any lates within the past 12 months but will do a streamlined process and not fine tooth the credit report if the mid score is 640 or above.

"My income seems in the moderate category for USDA standards for my area.  Small debt, $399 car payment, no cc debt or other.  Found a new home that is a builder foreclosure and it is listed about 60% of value, unfinished and sold as is. "

-The home will need to pass the standard HUD home inspection criteria before approval.  I would look up what those requirements are and make sure your home will pass.

"Will the house and I qualify for either of these programs? If so, we will have to go through manual underwriting?"

-With a mid-score of 574 and two lates in the last 12 months you will most assuredly go through manual underwriting. You will have to have strong compensating factors: steady work history, a history of savings, and proof that your lates were the result of a substantial out of the ordinary  occurrence not likely  to happen again.

"It is such a great house, great value and I am so tired of flushing money in rent!"

- It sounds like a great deal.  See if you can goodwill your creditor into removing those lates and work quickly and diligently to get those errors off and you should see your score substantially rise.  Good luck.