Did you know that for the same loan size and a similar rate that the USDA Rural Development Home Loan will ALWAYS have a lower payment than FHA? Sometimes the USDA Rural Development payment will be substantially lower.
Let’s talk rates and payments…
When most people shop for a USDA Rural Development Mortgage the first thing they ask is… “What’s the rate?” The problem is that they are often comparing rates for a USDA Rural Development home loan to an FHA Mortgage Loan or Conventional Loan. Some of the time, the USDA Rural Development rate will be slightly higher, but not much.
You pay your monthly mortgage payment, whether it is USDA Rural Development or FHA or Conventional you do not pay a rate. You make a payment based on Principal, Interest, Taxes and Insurance.
All FHA Mortgage Loans have an additional payment component, mortgage insurance. USDA Rural Development Home Loans do NOT have this additional monthly expense. It’s easy to calculate how much the monthly FHA Mortgage Insurance payment will be. Here is the formula:
Loan Amount x 0.55% = Annual Mortgage Insurance (divide by 12 for the monthly FHA Mortgage Insurance Payment)
Example:
A $200,000 USDA Rural Development home loan at 5.5% would have a monthly Principal and Interest payment of $1135.58.
That same $200,000 FHA Mortgage Loan would have that same Principal and Interest payment of $1135.58 but would also have the additional Mortgage Insurance Payment of $91.67 EVERY MONTH. The USDA Rural Development Home Loan saves over $90 bucks a month over an FHA Mortgage Loan with the same loan amount and rate.
Have some fun and play around with our USDA Rural Development Mortgage Calculator and see for yourself the massive savings you can have with USDA Rural Development.
To find out how much USDA Rural Development Home Loan you qualify for today and how much you can save over an FHA Mortgage Loan, click on the Get Started tab above or click here.
Apply online for a USDA Rural Development Home Loan and get pre-qualified today.
Paul Dunn Tucson's #1 FHA Mortgage Loan Originator
Arizona USDA Rural Home Loans
Apply online for a USDA Rural Guaranteed Home Loan and get pre-qualified today.
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Paul - do you hear of any changes in the boundaries for qualification anytime soon?