If you are living in Pennsylvania and want to buy a home of your own, you can apply for a USDA home loan. To qualify you need to have an eligible monthly income. Ideally, if you are applying for USDA Guaranteed loan, your monthly income should be less than or equal to 115% of the AMI. This is very important since USDA loans are available for low to moderate income families. You can use USDA home loans can to buy a home or to refinance an existing USDA loan to lower the interest rates.
USDA Loans for Pennsylvania – 100% Financing by USDA Loans
100 percent financing by USDA means you have to pay no down payments to buy a home. In certain cases, you can even combine the closing costs within the loan amount, so there is nothing you have to pay from your pocket. Moreover, you can refinance your existing home loan to 100% of the appraised value of the property.
This is specifically very helpful for first time home buyers since most first time buyers have little or no savings and this is the reason why they cannot qualify for conventional loan programs. Most of the loan programs require a huge down payment, high credit scores and collaterals for securing the loan. But USDA is one of the government backed loan programs that allow you to buy a home without down payments even if you have bad credit scores.
There are no pre payment penalties as well.
This makes the USDA home loans the most affordable and popular in Pennsylvania. But you and the property to be financed must qualify according to the USDA guidelines.
Some Misconceptions Regarding USDA Home Loans
People have a lot of misconceptions about USDA loans, while many don’t even know about these affordable and convenient loan programs. USDA has helped millions with home buying and all of them are proud owners of their dream homes. So if you want to be one among them you need to get rid of the misconceptions that you have about USDA home loans. Here are some prevalent misconceptions about USDA:
- USDA loans are ‘Farmer Loans’ and you have to live in farmlands to get USDA home loans. This is totally incorrect. USDA loans are available for people from all walks of life. Even people living in metros who are looking for relocation opportunities can avail USDA home loans.
- Many people still think conventional loans or FHA loans are better and provide better security. The truth is USDA loans offer better opportunities than any other loan programs.
- USDA has stringent guidelines. USDA home loans have the most flexible guidelines and offer the lowest interest rates.
- USDA loans are just for first time home buyers. This is not true. Anyone and everyone who qualifies to the income and credit guidelines, whether first time buyers or repeat buyers, are eligible for USDA home loans.
- You have to live in rural areas. USDA states that the borrower has to buy a property located in USDA designated rural areas that do not always mean you have to live in farmlands. Many small towns just outside the metro city are also designated rural by USDA, but they are not ‘rural’ in actual sense.
- USDA home loans are harder to get than other loan programs. The truth is quite the opposite. USDA loans are easily available since government supports these and they have lenient guidelines.
If you’re looking for assistance with USDA home loans in Pennsylvania, get in touch with us. You can call us or you can fill out our online enquiry form.