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What are the benefits of the Tennessee USDA loan?

The Tennessee USDA loan has several benefits. Some of them are:

Who is eligible for the Tennessee USDA home loan?

The Tennessee USDA home was designed for households of low to moderate-income in rural areas. Anyone who wants to purchase a home in a qualifying area and meets the eligibility requirements can participate in the program.

Do I have to be a first-time homebuyer to utilize the Tennessee USDA loan?

No, you are not required to be a first-time homebuyer when using the Tennessee USDA loan. Move-up buyers are eligible to participate; however, they must sell their current home before closing on their new USDA loan as the USDA program does not allow home buyers to have two houses in most cases.

What the maximum loan amount with the Tennessee USDA home loan?

The Tennessee USDA home loan does not have a maximum loan amount. If the homebuyers meet the household income requirements and the debt-to-income ratio requirements, they are eligible to purchase a home.

How do I find the USDA eligible areas in Tennessee?

The USDA eligibility map is straightforward to use. Homebuyers need to enter the address of a property, and the map will indicate if the property is eligible or not. If a property has not been located, then the user can do a general search to see what areas qualify.

What does it mean by maximum household income?

The USDA home loan has a unique qualifying feature that is referred to as household income. By definition, the loan product is for low to moderate-income households in rural areas. The household income requirement is used to make sure borrowers fall in this category. The maximum limit will vary from county to county. The formula used is 115% of the median income of a given area.

Can I have a swimming pool and still get a Tennessee USDA home loan?

Yes, homebuyers can use the Tennessee USDA home loan to purchase a home with a swimming pool. The pool must be fully functional without any safety issues.

What is the difference between the Tennessee USDA guaranteed loan and the direct USDA loan?

The Tennessee USDA guaranteed loan is a loan product that is offered by a private lender or bank but is backed by the USDA. The USDA direct loan is a loan product that the USDA provides, and homebuyers work directly with their local USDA office.

Can I obtain a 30-year USDA home loan?

Yes, the USDA loan is a 30-year mortgage. The loan is fully amortized, so when the final payment is made, the home will be completely paid off.

What is the minimum credit score needed to obtain a USDA loan in Tennessee?

To obtain a USDA loan Tennessee, you will need to check with your lender to see what their minimum credit score is. The USDA loan does not have a minimum score, and it is left up to the individual lender to make this decision. Most lenders offer the USDA loan in Tennessee with credit scores between 620-660.

Does the Tennessee rural development loan allow a septic tank?

Yes, the Tennessee rural development loan does allow properties that are equipped with a septic tank. This is very common in rural areas. It must be properly installed and functioning correctly.

Texas USDA Home Loans with 100% Financing

Am I eligible for a USDA rural development loan if I have had a previous bankruptcy?

Yes, homebuyers with a previous bankruptcy are still eligible to obtain a USDA rural development loan. The rule is that the borrower must be three years removed from this event.

Does the USDA home loan Tennessee have mortgage insurance?

The USDA home loan Tennessee has its version of mortgage insurance. The fee is called a guarantee fee. This fee is found in two places. There is an upfront guarantee fee of 1% that is added to the loan amount. There is also a yearly fee that is paid out monthly.

Are interest higher on the USDA home loan compared to other loan types?

Interest rates will vary from lender to lender; however, the USDA home loan rates are typically in line with FHA and VA. The homebuyer must speak with their loan officer to get current interest rates.

Am I required to have flood insurance with the Tennessee USDA loan?

The Tennessee USDA loan only requires the homebuyer to obtain flood insurance if it is located in a flood zone. The homebuyers loan officer can do a quick check to make this determination.

What is the maximum amount of acreage allowed with the USDA loan Tennessee?

The USDA loan Tennessee does not have a set limit on acreage that a property can have. The caution to this comes in two areas. The first being if the value of the overall transaction becomes more based on the land than the home this can be an issue. The USDA loan is a residential loan. The rule of thumb is around 30%. This means that of the total value, no more than 30% should be in the land. The second caution is comparable sales. When there is excess acreage in a transaction, it becomes more difficult to find similar sales for the appraisal.

Can I purchase a working farm with the USDA home loan?

While the USDA does have programs for farmers, the USDA home loan falls under the single-family housing program and is designed for rural residential homes. Income-producing properties such as farms are not eligible.

Am I required to escrow my taxes and insurance with the USDA loan?

Yes, the USDA loan does require homebuyers to set up an escrow account at closing for their taxes and insurance. The monthly payment will also include their taxes and insurance.

Can I move to a new state and utilize the USDA loan?

Yes, homebuyers that are relocating from one state to another can utilize the USDA loan. All requirements will still apply. They will have to qualify and purchase in a qualifying area.

Does the Tennessee USDA rural development loan allow me to purchase a foreclose?

Yes. The Tennessee rural development loan does allow homebuyers to purchase a foreclosed property. The property will have to meet the same standards as a non-foreclosed property.

Can I do a USDA home loan refinance?

The USDA home loan does have a product for refinancing as long as the current loan is a USDA home loan. If the existing loan is not a USDA loan, you cannot refinance into a USDA loan.

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Arkansas Home Mortgages

Primary Residential Mortgage, Inc.
10121 N Rodney Parham, Suites C & D
Little Rock, AR 72227
NMLS # 3094
Branch NMLS # 252910
Licensed by Arkansas Securities Department 11558
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Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. This is not a commitment to lend. Programs, rates, terms and conditions are subject to change without notice.