USDA loans are a type of mortgage loan offered by the United States Department of Agriculture (USDA). They are designed to help low and moderate-income families in rural areas become homeowners. This loan program is not limited to first-time homebuyers, but it does have income restrictions.
One significant advantage of USDA loans is that they require zero down payment. This means that you can finance up to 100% of the home’s value without having to put any money down. Additionally, USDA loans offer competitive interest rates and flexible credit requirements than conventional mortgages.
Another benefit is that USDA loans do not require private mortgage insurance (PMI), which can save you thousands over the life of your loan.
To qualify for a USDA loan, you must meet certain criteria such as the property being located in an eligible rural area and meeting income limits based on family size and location. You will also need to have a credit score of at least 640 or higher.
In conclusion, if you are looking for a home in a rural area and want to take advantage of a zero-down payment option with lower monthly payments, then consider applying for a USDA loan.