USDA Rent verification

[boog13]

Hi All,

I'm looking into getting a USDA home loan but I have a few questions:

1. Does USDA require rent verification?

I'm currently living with a family member in order to save for a home and I'm not currently paying any rent?

2.Is the closing cost for USDA loans typically higher than FHA?

Any answers you can provide would be helpful.

Thanks.

[JMMD]

We had to provide 12 months of rental history ( I sent 12 months of cleared checks) and provide my land lords contact info. 

[Anonymous]

I just went through USDA got my clear to close today. I moved out of my rental a year and a half ago and moved home to pay off debt. Once you are over a 680 mid mortgage score you should not have to do verification of rent. If under 680 you will have to provide and If you don’t rent payment shock will be taking into consideration for scores under 680. I didn’t have to.

[homeloanexpert]

The GUS (guaranteed underwriting system) findings will determine if a VOR (verification of rent) is required. If you have been staying with family, then be prepared. The lender will require a letter of explanation from the family member stating you were living rent free. If the lender insists on a VOR even if the GUS doesn't require it, you can push back or maybe go back in time until you had a previous rental history. Most lenders follow the GUS, but are others that have their own overlays.

[JMMD]

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@Anonymous wrote:
I just went through USDA got my clear to close today. I moved out of my rental a year and a half ago and moved home to pay off debt. Once you are over a 680 mid mortgage score you should not have to do verification of rent. If under 680 you will have to provide and If you don’t rent payment shock will be taking into consideration for scores under 680. I didn’t have to.

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Our scores were in the 700's and we still needed to provide rental history.

[Anonymous]

I am guessing that was

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@JMMD wrote:

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@Anonymous wrote:
I just went through USDA got my clear to close today. I moved out of my rental a year and a half ago and moved home to pay off debt. Once you are over a 680 mid mortgage score you should not have to do verification of rent. If under 680 you will have to provide and If you don’t rent payment shock will be taking into consideration for scores under 680. I didn’t have to.

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Our scores were in the 700's and we still needed to provide rental history.

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I am guessing that was a lender overlay.  Because it even says in the USDA handbook that scores over 680 do not have to provide VOR and payment shock isn't factored.  I definately didn't have to show any proof of rent or even write an explanation letter. Hopefully this helps.

[boog13]

Thank you. Last time I checked, my mortgage middle score was 662. I'm already preapproved for FHA new construction. I guess I'll have to try to get to 680 in order to meet USDA conditions.

[Anonymous]

You can still be approved you will probably just have to explain why you weren’t renting. Talk to your lender they can advise you.

[boog13]

I will contact my lender and discuss my USDA options. Thanks everyone