Having a home is a great achievement, whether it is located in a rural or urban area. Although acquiring a roof over your head may involve a large capital investment, facilities such as the USDA rural development program help many realise their dreams. If you wish to access a USDA loan, you’ll have to follow specific steps for a smooth application process. In this blog post, we get look at the steps you need to follow when taking a home loan under the USDA rural development program. Take a look.
1. Establish Eligibility at USDALoans.com
Before moving forward with the loan application process, it is important to first establish if you are eligible for the loan. Under the pre-qualifying process, loan officers check your eligibility based on your financial documents. The documents provide a general estimate of what you can afford, and if you are even eligible for the program. This is a vital step that can save you time and can give you an idea of homes you can purchase.
2. Get a Pre approval Letter
In the pre-approval process, loan officers take account of pay stubs, tax returns, W2s, your employment history, investments, and other assets. After the documents get approved, you receive a pre-approval letter. Although you are considered eligible for the loan process, pre-approval doesn’t mean you are guaranteed a USDA Loan. There are other considerations which affect your loan application.
3. Look for the right home
After receiving the pre-approval letter and meeting the eligibility criteria for a USDA loan, you can start looking for your desired home. Once you have all the legal documents and approval letter, you can enter into an agreement with a home agent. Find a knowledgeable and experienced agent with a good reputation to help you buy your dream home.
4. Make an Offer
Ensure the real estate agent knows you have taken a USDA Loan and prepares your offer so that the seller pays closing costs. If you are unable to negotiate closing costs into the offer, the USDA Loan program allows gift funds from family members to pay closing costs. You need a gift letter to accompany your application.
5. Processing & Closing
After making an offer, schedule inspection of the property to ensure it meets USDA Home Loan standards and is ready for occupation. The seller will fix all the necessary issues if the property does not meet standards. Once you have signed the contract, an underwriter will review your information to make sure there have been no major changes. The underwriter then approves the loan and schedules a closing date when you can complete all paperwork and take ownership of the property.
The USDA rural development program ensures home loan seekers have easy access to funds to buy their dream homes in rural jurisdictions. You must first meet the eligibility criteria for pre approval qualification. Try maintaining your legal commitments related to the loan repayment and follow policies mentioned in the USDA home loans contract agreement.