USDA Lending and Qualifications

If you live in an area that’s rural, it’s possible that you might be eligible for a USDA loan, in addition to an FHA loan. USDA loans aren’t as common, but they can be highly advantageous for those who qualify. In essence, the United States Department of Agriculture will guarantee a private loan to help those living in rural communities. See if you might qualify for a USDA loan.

What is the USDA’s Financing Process?

The primary goal of the USDA is to make mortgage loans accessible to lower-income families in Oregon. The organization usually does this by guaranteeing mortgage loans issued by approved private lenders. You can expect these guaranteed mortgages to include no down payment at a fixed rate on a 30-year term.

Who is a USDA Loan Intended for?

If you’re a low or moderate-income household located in rural Oregon, you could potentially qualify for a USDA loan. Many Hood River County buyers are eligible, but you’ll want to do some legwork to truly know if you can get one. The loan is a good choice for you if you’re looking to purchase a single family home, condo, or planned unit development. You’ll likely need a credit score of at least 620.

What Are the Requirements and Qualifications of a USDA Loan?

In a USDA loan, unlike with FHA loans, it’s possible to get 100% financing. In other words, you can go into the loan with no down payment. Just be aware that the USDA Rural Development Mortgage amount can’t be higher than 102% of the appraised value of that new home you’re trying to buy. It’s not uncommon to roll closing costs into the amount of the loan, but this is only possible if your income isn’t higher than the USDA maximum for your particular area.

Digesting all of this information about USDA loans can be a little intimidating, but we’re here to help. Contact us today to get connected with a knowledgeable mortgage broker to find out if it’s worth pursuing a USDA mortgage on your new Oregon home! 

Conventional Loans

If you’re new to the world of buying a home, you’ve probably heard the term “conventional loan” thrown around. Basically, it’s referring to any loan that isn’t guaranteed by the federal government, such as a USDA or FHA loan. These are loans with more flexible terms and options than a typical government loan, including greater choice in whom you choose as a lender. Is an Oregon conventional loan right for you?

The Conventional Loan Process

Here’s a little bit about how the conventional loan process works. The first thing to do is determine if you’d rather have an adjustable rate loan or a fixed rate loan. Your adjustable rate loan goes up and down with interest rates, but usually starts out at a lower rate than a fixed rate mortgage. As for a fixed rate mortgage, they are beneficial because the payment stays the same for the life of the loan. The most common terms for a mortgage are 15, 20, 30, and 40 years.

Who Qualifies for a Conventional Loan?

If you’re applying for a conventional loan, you’re going to need a better credit score and a more sizable down payment than you’d need to qualify for a typical government-based loan. Fortunately, in spite of some stricter requirements, you also have a lot more choice at your disposal in whom you lend from as well as what the terms are. It’s wise to save up a down payment of 20% to avoid private mortgage insurance (PMI), but you may possibly qualify with as little as 3% down to get a conventional loan.

Requirements and Qualifications of Conventional Loans

In addition to fixed rate or adjustable, conventional loans can be conforming or jumbo loans. A conforming loan is any sum borrowed for less than $417,000. This will get you a more favorable interest rate and isn’t as difficult to qualify for. Here are a few other requirements to consider:

• Credit quality
• Loan size
• Debt to income ratio
• Condition of the property
• Loan to value ratio

How do you know if you should choose a conventional loan for your new Oregon home? Ask us today to find out more!

FHA Loans and Requirements

It’s no secret that some people get extra assistance from the federal government for

home ownership. The agency responsible for providing loan aid to first time

homebuyers is the Federal Housing Administration (FHA), an organization under the

jurisdiction of the US Department of Housing and Development (HUD). It applies to

states all across the country, including Oregon.

What Is an FHA Loan?

In essence, an FHA loan is a loan guaranteed by the federal government through

approved private lenders. It’s intended for people who have a difficult time qualifying

for a conventional loan or don’t have the means to accumulate a sizeable down

payment before they’re ready to buy a home. The FHA itself isn’t technically a source of

loans, but by guaranteeing loans to riskier borrowers, it encourages private lenders to

provide mortgages to homebuyers who may not otherwise qualify.

Who Is an FHA Loan For?

Is an FHA loan the right choice for you? Any Oregon first time homebuyer with a credit

score below 720 but higher than 620 is a possible candidate for an FHA loan. Another

important factor is having a high debt-to-income ratio. It’s also good for people with

stable employment but a blip or two on their credit history. Another great benefit of an

FHA loan is being accessible to those who don’t yet have a 20% down payment, which is

the equivalent of $40,000 or more in many cases.

What Are the Qualifications for FHA Loans?

Oregon FHA loans are given to people with savings as little as 3% of the purchase price

for their down payment. Every Oregon county has a maximum loan limit, with Hood

River County’s currently set at $371,450 for a single family home. The amount you may

qualify for can vary depending on the lender you choose, so you may want to shop

around for the right FHA lender.

For more information on Oregon FHA loans—and to find out if you qualify contact us

today!