Johnson County, AR has
No Money Down Loans Available
to purchase a Home!
RURAL DEVELOPMENT LOANS
What does this program do? 100% loans to eligible rural home buyers.
Buyer pays the appraisal fee, normally $550, and that's it!
What Types of Loans does USDA offer in Arkansas?
Currently, there are two kinds of USDA Home Loans available in Arkansas for single family households:
USDA Guaranteed Home Mortgage Loans are the most common type of USDA Loan in Arkansas and allow for higher income limits and 100% financing for
home purchases. USDA Guaranteed Loan applicants may have an income of up
to 115% of the median household income for the area. Area income limits
for this program can be viewed here. All USDA Guaranteed Loans carry 30
year terms and are set at a fixed rate.
USDA Direct Housing Loans are less common than USDA Guaranteed Loans
and are only available for low and very low income households to obtain
homeownership, as defined by the USDA. Very low income is defined as
below 50 percent of the area median income (AMI); low income is between
50 and 80 percent of AMI; moderate income is 80 to 100 percent of AMI.
Click here to see area income limits for this program.
What factors determine if I am eligible for an Arkansas Rural Development Loan?
There are several things to determine a borrower’s eligibility. The
first thing to consider is credit score. While USDA doesn’t set a min
score most lenders require a 640 or better score. The next is debt to
income ratio. A standard approval requires a housing ration of no more
than 29%. This means that the total home payment each month cannot
exceed 29% of the borrower’s gross income. Additionally a borrower’s
total debt including housing payment cannot exceed 41% of the monthly
gross income. These ratios can be exceeded somewhat with compensating
factors. Applicants for loans may have an income of up to 115% of the
median income for the area. Maximum USDA Guaranteed Loan income limits
for your area can be found at here. Maximum USDA Direct Loan income
limits for your area can be found at here. Families must be without
adequate housing, but be able to afford the mortgage payments, including
taxes and insurance.
What is the maximum amount that I can borrow?
The maximum amount for an USDA home loan is determined by: USDA Loans
actually do not have a maximum loan amount. The debt to income ratio
will determine the max loan amount on each loan because the borrower’s
will be limited on loan amount by the ratios set forth. As stated
earlier the max ratios are 29% and 41%. Additionally, your total
household monthly income must be within USDA allowed maximum income
limits for your area. Maximum USDA Guaranteed Loan income limits for
your area can be found at here.
Maximum financing: The maximum USDA Rural Development Loan amount is
102% of the appraised value of the home (100% plus the 2% USDA RD Loan
How much money will I need for the down payment and closing costs?
USDA Rural home loans do not require a down payment. Borrowers can get 100% no money down loans.
What are the allowable property types for USDA Home Loans?
USDA requires all loans to be for Owner Occupied properties. The
different types of allowable properties are SFR, Condos, Manufactured
Homes, and PUD’s. Lenders will decide on each property type as to if
they will loan on those certain properties.
Who may apply for this program?Applicants must:
- Meet income-eligibility.•Agree to personally occupy the dwelling as their primary residence.
- Be a U.S. Citizen, U.S. non-citizen national or Qualified Alien.
- Have the legal capacity to incur the loan obligation.
- Have not been suspended or debarred from participation in federal programs.
- Demonstrate the willingness to meet credit obligations in a timely manner.
- Purchase a property that meets all program criteria
VA helps Service members, Veterans, and eligible surviving spouses
become homeowners. As part of our mission to serve you, we provide a
home loan guaranty benefit and other housing-related programs to help
you buy, build, repair, retain, or adapt a home for your own personal
VA Home Loans are provided by private lenders, such as banks and
mortgage companies. VA guarantees a portion of the loan, enabling the
lender to provide you with more favorable terms.
VA Home Loan Advantages
The guarantee VA provides to lenders allows them to provide you with more favorable terms, including:
- No down payment as long as the sales price doesn't exceed the appraised value.
- No private mortgage insurance premium requirement.
- VA rules limit the amount you can be charged for closing costs.
- Closing costs may be paid by the seller.
- The lender can't charge you a penalty fee if you pay the loan off early.
- VA may be able to provide you some assistance if you run into difficulty making payments.
You should also know that:
- You don't have to be a first-time home buyer.
- You can reuse the benefit.
- VA-backed loans are assumable, as long as the person assuming the loan qualifies.