topic Re: USDA questions in Mortgage Loans

USDA questions

avigeant83 — Sat, 13 Apr 2013 10:58:11 GMT

Hey everyone,

I finally got my credit score to 600 from 500 from last August. I've been on time for 11 months straight with one in collections for a measly $200 that I have mostly paid off. I know that I'm a ways way from 620 but I believe that in the next few months I might have a chance to eclipse that mark. With that behind us, how easy is it to obtain a USDA loan? I read online the requirements and I meet the standards with a family of 3 making 70,000 a year in the state of Massachusetts. Can you put the lender fees into the loan? My lease is running out in July and would like to purchase a home in the next few months. Any feedback would be great!

-Drew

Re: USDA questions

Anonymous — Sun, 14 Apr 2013 04:17:22 GMT

Once you get to 620 you should be good. They do have strict debt to income ratios. 29/41.

And you can roll closing costs into the loan as long as there is enough room between your loan amount and the properties appraised value.

Re: USDA questions

avigeant83 — Sun, 14 Apr 2013 23:27:34 GMT

Thank you a lot, I read about the rules of USDA...can't be a town next to a town of 50k population and the town itself has to be below 20k. Will most homes be covered by USDA? Do they accept condos?

Re: USDA questions

trix_r_4_kids — Sun, 14 Apr 2013 23:33:03 GMT

@avigeant83 wrote:
Thank you a lot, I read about the rules of USDA...can't be a town next to a town of 50k population and the town itself has to be below 20k. Will most homes be covered by USDA? Do they accept condos?

I don't know about condos, but you can check property eligibility here: http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=sfp

Re: USDA questions

avigeant83 — Mon, 15 Apr 2013 00:01:33 GMT

Yes I seen that website, so any houses in the elgible areas should be fine? I'm hoping in the next few months my score will jump up a bit with just time and my debt ratio is limited and I make good money.

Re: USDA questions

avigeant83 — Wed, 08 May 2013 06:29:50 GMT

So I finally got my score to the 620sh range, TU @ 629 and EQ @ 620, no idea what experian is at the moment. But now from what I heard is that it's actually a 640 mid credit pull that needs to be pulled. Every thing that I've read always states "620" as the main goal with guaranteed loan. So now I have to wait more? It's disheartening this wait.

Re: USDA questions

tdrjustus3 — Wed, 08 May 2013 12:01:30 GMT

Do you have a strategy for improving your score?

Re: USDA questions

brownj12 — Wed, 08 May 2013 13:35:35 GMT

You can do USDA with less than a 640, the USDA minimum is 620, many banks require a 640 but there are banks that will do 620. Find a broker that does a lot of loans for people with boarderline credit and they will be able to help.

I just did a USDA loan with a 639, unfortunately I couldn't get the last point I needed quite quick enough (up to 672 now, about two months later). We went with a different lender than I would have if I was over a 640 but it wasn't much different. According to my broker the differences were an extra $700 at closing due to different lender credits. The lower score would require rent history from my landlord. Any collections would need to be paid (I had one for$315 that was 18 months old). And I would need a compenstating factor, in my case this was 3 months PITI in reserve, my broker said there would be other options but that was the easiest.

Overall it is a little more work if you can't hit 640 but it isn't a deal breaker.

Re: USDA questions

swtneka — Sat, 08 Jun 2013 23:08:32 GMT

Any update on the USDA loan?