Thursday, October 9, 2014

USDA Loans: Down Payments Can Be Optional


By Guest Contributor Owen Munton
Mortgage Production Manager -MS & Vice President at Hancock Bank in Hattiesburg

Buying a home does not always require a large down payment.  The United States Department of Agriculture (USDA) offers loan guarantees to banks and mortgage lenders that eliminate the need for down payments for those wishing to buy a personal residence.   Through the USDA’s Section 502 Guaranteed Housing Loan Program, a person may finance the full price of a home over 30 years with a low, fixed interest rate.
 
Potential homeowners will be asked to document their income and will need to stay within the USDA’s income limits to be eligible for the program.  Those limits are based on the number of people who will occupy the home and the county in which the home is located.   The maximum income limits for most counties in Mississippi are $74,750 for 1-4 person households and $98,650 for 5-8 person households. 
 
The loan program is only available in certain rural areas of each county.  A map of the eligible areas can be found at http://eligibility.sc.egov.usda.gov/eligibility/incomeEligibilityAction.do. The full street address will need to be used when checking for eligibility to ensure accurate results. 

The USDA Rural Housing program is offered through your bank or mortgage lender.  They will ensure that all program requirements are met, will set interest rates and discuss monthly payments. 
 
Owen Munton is Mortgage Production Manager – MS and Vice President at Hancock Bank in Hattiesburg. To contact Munton, you can e-mail  owen.munton@hancockbank.com or call 601-818-6225.

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