USDA Home Loans In Seattle

The USDA Home Loan program in Seattle, Washington, is intended to help low- and very-low-income families purchase homes in rural areas. This program helps low- and very-low-income applicants obtain adequate, safe, sanitary housing in eligible rural areas. Payment assistance is a form of subsidy that reduces the mortgage payment. The family’s income determines the quantity of assistance.

Types of USDA Home Loan Programs in Seattle

This initiative is divided into the following sub-programs:

• Single Family Housing Direct Home Loans (Section 502 Direct Loan Program)

This program aims to assist low- and very-low-income applicants in obtaining appropriate, safe, and hygienic housing in designated rural locations. It provides payment assistance to improve an applicant’s repayment capability. Additional funding was provided under the American Rescue Plan Act (ARPA), signed into law in 2021. Still, this funding was rescinded, but the USDA continues to accept applications for COVID-19-related payment moratoriums.

• Single Family Housing Guaranteed Loan (Section 502 Guaranteed Loan Program)

This program assists licensed lenders in allowing low-income and moderate-income households in suitable rural areas to possess adequate, safe, hygienic housing. Appropriate candidates may use 100% financing to buy, build, remodel, improve, or relocate a home in a proper rural region. This program provides certified lenders with a 90% loan note guarantee to decrease the risk of issuing 100% loans to qualifying rural homebuyers.

• Single Family Housing Repair Loans & Grants (Section 504 Home Repair Program)

This program provides loans to low-income homeowners to repair, improve, or modernize their homes and grants to elderly low-income homeowners to alleviate health and safety hazards. It, too, was harmed by the cancellation of ARPA financing, but it continues to accept applications for specific instances.

• Rural Housing Site Loans

These loans offer low- and moderate-income families two types to purchase and develop home plots. Section 523 loans are only used to acquire and develop land for the Self-Help construction of homes. Section 524 loans are granted to acquire and develop land for low- and moderate-income people, with no restrictions on building methods.

The eligibility for these loans, loan guarantees, and grants is based on income and varies according to each region’s median average income. The USDA provides an Income and Property Eligibility Site to evaluate the likelihood that a prospective applicant would be eligible for program assistance and determine whether a property is in a suitable rural area.

USDA Home Loan Eligibility Requirements

To reduce the risk of extending 100% loans to eligible rural homebuyers, the USDA Guaranteed Home Loan program offers 100% financing and a 90% loan note guarantee to approved lenders. Therefore, no down payment is necessary for those who qualify.

To be eligible for this program, applicants must meet the following requirements:

• Household Income

Meet the income eligibility requirements (no more than 115% of the median household income).

• Occupancy

You must agree to live in the house as your primary residence.

• Citizenship

You must be a US citizen, a US non-citizen national, or a Qualified Alien. 

• Credit and Income

Although lenders require a minimal credit score of 640 for USDA home loans, the USDA does not have a minimum score requirement. If your credit score is lower, you may still be eligible for a loan, but additional compensating factors may be required. 

• Location

The eligibility of a property is contingent on its location. The property must be located within a USDA-approved rural area. You can use the USDA’s Eligibility Site to input a specific address to determine eligibility or search the map to view general eligible areas.

Apply for a USDA Home Loan with Capital Home Mortgage

Capital Home Mortgage is the best option for USDA-guaranteed home loans in Seattle, providing homebuyers with unmatched advantages. USDA loans, guaranteed by the USDA Rural Development Guaranteed Housing Loan Program, offer the significant benefit of requiring no down payment, which is a substantial benefit for those who may struggle with initial costs. Typically, these loans have lower interest rates than conventional mortgages, allowing for savings over the loan term. Utilizing Capital Home Mortgage for a USDA loan in Seattle enables applicants to take advantage of the program’s lenient eligibility requirements, which accommodate low-income households and those with imperfect credit. The program encourages homeownership in eligible rural and suburban areas, and due to the expansive definition of “rural” by USDA standards, several locations in and around Seattle may qualify. Consequently, partnering with Capital Home Mortgage can access these benefits, making homeownership more affordable.

Call  (253) 528-4417 to speak with one of our Seattle USDA Home Loan Specialists.