Reprinted from the Tooele Transcript Bulletin
GUARANTEED RURAL HOUSING WORKS IN TOOELE
USDA Guaranteed Rural Housing Loans are a viable homeownership option here in Tooele County. According to the most recent census all of Tooele County - including Tooele city- still qualifies for this government insured loan program.
When the federal government agrees to guarantee the loan, lending institutions like ours can help buyers while incurring less risk. Through this program low and moderate income people can qualify for mortgages even without a down payment. If the proposed changes to FHA become law Rural Housing and Veterans Administration loans will be the only zero money down loans available to anyone.
Mortgages are 30-year fixed rate at market interest rates and because there is no mortgage insurance monthly payments are often lower then if a down payment was used. Loans may include funds for closing costs, the USDA guarantee fee, title fees cost of establishing an escrow account and other prepaid items if the appraised value is higher than the sales price. The program also allows sellers to contribute to those costs so most families can buy and move for less out-of-pocket money than would be required to move from one rental to another.
To be eligible for the program a family must plan to live in the home as their primary residence and can not own any other property. They do not have to be first time buyers, however. They must be a U.S. citizens, qualified aliens, or be legally admitted to the U.S. for permanent residence. There are also income limitations. A family of four here in Tooele County can not earn over $70,750 adjusted gross annual income and use the program.
As an applicant you must have a credit history that indicates a reasonable willingness to meet obligations as they become due; there are many interpretations of this rule so don’t assume you won’t meet the criteria. You will also have to demonstrate the ability to repay the loan based on your debt-to-income ratios (the amount of debt divided by the gross monthly income).
A recent improvement to this program comes in the way of qualifying the property to be used as collateral. These days just about any habitable home will qualify. According to the guidelines; existing homes must be structurally sound, functionally adequate, and in good repair. The kind of homes most people want to buy anyway. There are no restrictions on the size or design of the home being financed either so long as it is in a rural area.
Charles Prows is manager of Premier Mortgage Services Tooele branch. He is licensed with the Utah Division of Real Estate as an Associate Lending Manager and Continuing Education Instructor. Reach him at charlesprows@yahoo.com or by phone @ 801.910.4888 |