Buying A Home
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
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Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Has anyone used a USDA rural dev loan?
I'm curious if anyone here has used or is using a USDA rural development loan.
If so can you walk me through how your process went?
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BFP #1 10/28/09 EDD 6/24/10 - Miscarriage 11/2/09
BFP #2 11/30/09 EDD 8/12/10 - Sophia Grace born 8/1/10
BFP #3 11/16/10 EDD 8/4/11- Samuel Richard born 7/28/11
BFP #4 01/04/12 EDD 9/19/12- Simon Nathaniel born 9/6/12
Re: Has anyone used a USDA rural dev loan?
We did. It was also our first home so I am not sure how different it is compared to other loans.
First, you need to be qualified for the loan, you cannot exceed the income limit (you also need to be within the eligible range) and the property has to be within limits too (no large lots, up to code, etc). They are more flexible with credit scores.
You may be required to do additional testing, we had to do water test (including lead), septic inspection, well inspection, as well as house inspection. Basically the house needs to be move in ready.
The loan is only for 30 years, fixed.
You can put in 0% down (including closing). We put in 5%. If you put down less than 20%- you'll need to pay PMI.
The property has to be located in the rural development area.
We went with them because they had the best rate (3.75%). It kind of felt like we had to provide a lot of information for them.
Again, this was our first time purchasing a home and we cannot compare our experience.
This is going to be our first time home buying. We've I guess... qualified to apply.
We filled out an application, sent it in. Got a letter stating if only DH goes forward on the actual application we will most likely be approved for X amount of loan.
We have the BIG application. Our current issue is the closing costs... I'm not sure we'll be able to do the real application until next year... because of this.
BFP #1 10/28/09 EDD 6/24/10 - Miscarriage 11/2/09
BFP #2 11/30/09 EDD 8/12/10 - Sophia Grace born 8/1/10
BFP #3 11/16/10 EDD 8/4/11- Samuel Richard born 7/28/11
BFP #4 01/04/12 EDD 9/19/12- Simon Nathaniel born 9/6/12
Don't mean to be harsh, but if you cannot afford closing costs then you are not ready to be home owners.
Save for downpayment, closing costs, moving costs, start up utility depostis, repair & renovations costs, decorating and furniture/appliances, outdoor equipment & tools, AND a good emergency fund of 6 month's expenses (you need to be prepared if the furnace dies, lose a job etc)
Do you know the point of a USDA rural dev loan? Help for lower income families to buy a home in rural areas...
BFP #1 10/28/09 EDD 6/24/10 - Miscarriage 11/2/09
BFP #2 11/30/09 EDD 8/12/10 - Sophia Grace born 8/1/10
BFP #3 11/16/10 EDD 8/4/11- Samuel Richard born 7/28/11
BFP #4 01/04/12 EDD 9/19/12- Simon Nathaniel born 9/6/12
I know it sounds harsh but the pp is right. Unless the USDA is going to bail you out when you need a new roof, buy a lawn mower for you, etc, I would also want to have some money saved up to cover those as well. Whenever you're a home owner you're responsible for everything.
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So because I'm paying for all that now means I can't afford it when I buy a house?
Because last I checked I just paid for new windows, the water heater to be serviced because it crapped out. Not to mention the freaking exterminator because the old bat feeds the chipmunks who then live in my living room. Oh yes and not to mention all new carpet downstairs because it literally disintegrated when I tried to steam clean it.
ETA: I also pay her electricity bill because DH can't say no...
BFP #1 10/28/09 EDD 6/24/10 - Miscarriage 11/2/09
BFP #2 11/30/09 EDD 8/12/10 - Sophia Grace born 8/1/10
BFP #3 11/16/10 EDD 8/4/11- Samuel Richard born 7/28/11
BFP #4 01/04/12 EDD 9/19/12- Simon Nathaniel born 9/6/12
We used the rural dev loan when we bought our first home in December. We liked that it was 0% down although we did have like 2% costs added as the PMI which when your spending as much as you do on a house we figure it would be just as good in the long run. especially knowing we'd be putting in new carpet, sanding the wood floors and finishing them, buying new furniture to fit a smaller living room not to mention I eventually need a new roof and windows. (adding another $10 a month was the least of my woried lol) The home we bought actually has some land with it-a previous post stated it had to be a small lot.
I know we also didn't have to do anything but sign our app cuz our mortgage guy did all that for us. He also told us that stipulations require the property not beable to house farm animals....which is where I got confused because we bought an older farm house that has a 2 story barn on the property....granted my husband and I know nothing about raising farm animals we still got the loan.
I know they are very picky with the R.D. loan qualifications. Our house was a bank repo but the bank went above and beyond when they found out we wanted to do the RD loan. they painted all the walls in the house (just white) and repainted the ouside of the house (2 stories) and the 4 car garage. However they didn't repaint the barn and it delayed our process by weeks. We even tried going as far as offering to sign something saying we'd paint the barn come spring time (in December Ohio has way too many cold nights and too much snow to allow paint to dry properly) but that was a no go....the seller had to meet the stipulations as we weren't allowed on the property till we had the keys and the RD was only requiring the barn be painted from the ground 8 feet up....mind you it a 2 story barn (how goofy!) but the bank ended up painting the whole thing for us.
Over all the waiting was the worst part (especially the last 3 weeks of trying to figure out if the barn was going to lose the house for us). Our offer was accepted in mid Nov and we got our keys Dec 28 so a little over a month with the issues we had was not too bad.
Hope this helps you.....we also did not have an emergency fund-which hasn't hurt us yet, but its also just my husband and myself. Do what you're comfortable with. Don't miss out on your dream home because others tell you you're not ready. I know for us, our mortgage was a few hundred dollars cheaper than our rent was each month so buying a house made more sense-plus I could make it my own!