Guaranteed Rural Development Loans- did you know…?

RD loans can be a challenge considering they have both income and geographic limitations. Once these hurdles are crossed though, what advantages does RD give you?

In Florida did you know RD:

-allows unlimited gifts.

-has no stated limitation on seller concessions (FHA and VA say 6%).

-allows closing costs up to 2% of the purchase price to be financed into the loan if the appraisal supports it.

-has no monthly private mortgage insurance, and only 2% up front (up front for FHA is 1.75% and starts at 2.15% for VA).

-requires no reserves after closing.

-states you can qualify even if you own other property as long as it's not "suitable".

-allows you to use the program even if you can qualify for other types of financing that are not as "reasonable".

-still allows you to use the rent of a property being vacated (up to 75%- and considering FHA's recent change, I don't think this will last long!).

-allows escrows at closing for repairs/replacement.

-does not require ANY explanation of negative credit if your score is over 620.

...and the list can go on, but I hope you get the message. There are certainly some downsides to RD loans but if your lender doesn't try to qualify you for RD, they are not serving your best interest! Check the Rural Development Loan Group for links to state specific information and local lenders who know the program. Some criteria can vary from state to state so it pays to have a local lender that is familiar with the guidelines!

Gerry Suarez, Jr.

Your FHA Loan Pro!