USDA Home Loan -What's your budget look like? - USDA can help get you into a home but it's up to you to maintain it. That means you'll be responsible for all maintenance, taxes, insurance, etc. That is not cheap. Especially for the first time homeowner who needs to buy everything a home will need.
Bottom line ultra simplified on USDA loans- they can be helpful but you need your ducks in a row. They don't have a set credit score requirement but they have strict DTI requirements. The entire application process can take 3-5+ months and you won't know if you are approved-or how much they will lend you- until the end. You will need to have savings. They don't cover home inspections (budget $600-$900 for this) and you need to pay the first years insurance up front like any other loan. All total you'll need a good $1500+ saved up. Some areas also require you to pay for a home ownership class. Many sellers don't want to work with USDA loans because they are slow (60-90 days to close vs. 30 or less with conventional) and buyers using the program usually ask for a ton of concessions. This on top of USDA having their own demands. This means in a competitive area your offer will be considered very last.
I'm not saying USDA is a bad program. It's not. It exists for a reason. Like any home purchase though you really need to dig deep into the information and have a very firm understanding of what you are doing. 100% financing on a home is very risky for several reasons. Without seeing your budget it's hard to say if it's for you
I'm not saying USDA is a bad program. It's not. It exists for a reason. Like any home purchase though you really need to dig deep into the information and have a very firm understanding of what you are doing. 100% financing on a home is very risky for several reasons. Without seeing your budget it's hard to say if it's for you
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