USDA Loans In Austin & Surrounding Areas

The United States Department of Agriculture administers USDA loans through the USDA loan program, often known as the USDA Rural Development Housing Loan Program. One hundred twenty-seven thousand families received assistance from the USDA in 2017 to purchase and renovate their homes and improve rural America’s economy and quality of life. It has no down payment and carries competitive interest rates.

What Is A USDA Loan?

A USDA home loan is a no-money-down home loan program for borrowers buying or building a home in a USDA-designated rural area. There are two types of USDA home loans, (a) Direct and (b) Guaranteed.

• USDA Direct Home Loan

The Section 502 Direct Loan Program offers support to low- and very-low-income applicants to help them afford good, secure, and hygienic housing in designated rural areas. An aid program known as payment assistance temporarily lowers the monthly mortgage payment. The family’s adjusted income calculates how much assistance is provided.

When establishing a candidate’s eligibility for Single Family Direct Home Loans, several factors are considered. To be eligible for a direct loan, applicants must, at the very least, have an adjusted income that is at or below the low-income threshold in the area where they intend to purchase a home, as well as show that they are willing and able to make payments on their mortgage.

Applicants must also meet the following criteria:

• be without a safe, secure, and clean place to live;
• not be able to get a loan from other sources on terms and conditions that are expected to be met;
• Agree that you will use the home as your primary residence;
• possess the authority to enter into a loan agreement;
• satisfy the prerequisites for citizenship or eligible noncitizenship;
• not have their participation in federal programs canceled or prohibited.

Direct loan program-financed properties need to:

• usually be no more than 2,000 square feet;
• not exceed the applicable area loan limit in market value;
• not be intended for activities that generate income.

• USDA Guaranteed Home Loan

The Section 502 Guaranteed Loan Program helps approved lenders offer low- and moderate-income families the chance to buy adequate, modest, decent, safe, and hygienic homes as their principal residence in qualifying rural areas. In an approved rural area, qualified candidates may use 100% financing to buy, build, renovate, upgrade, or relocate a home. To reduce the risk of offering 100% loans to qualified rural homebuyers, the program provides approved lenders with a 90 percent loan note guarantee. This means people who qualify can purchase a property with no money down!

This initiative enables lenders to collaborate with low- and moderate-income rural households to make homeownership possible. Affordable homeownership choices encourage prosperity, which fosters thriving communities and raises the standard of living in rural places.

Borrowers applying for the USDA Guaranteed Home Loan program must meet the following requirements:

• Must have a household income of no more than 115% of the area median income;
• Must use and live in the home as their primary residence;
• Must be a US citizen, a US non-citizen national, or a qualified resident alien.

How May The Funds Be Used

Individuals or households may use loan funds to acquire properties in rural areas. Funds can be used to purchase and prepare lands, install water and sewage systems, or build, repair, renovate, or relocate a residence.

Apply For Austin USDA Home Loan

Capital Home Mortgage is a Texas-approved USDA lender that will handle the loan application process. Speak with one of our USDA home loan specialists at (512) 237-7400 or initiate an online application to get started on your USDA-guaranteed home loan.