Great news!USDA has been "out of money" for a couple of weeks, and they finally have a couple of dollars (2.5 Billion) to loan!  We get Rural FAST in North Carolina - which is why USDA Rural Development Loans are so important!

People who purchased and want to take advantage of the Tax Credit, are now waiting to see if USDA can underwrite their loan fast enough to be able to close by the end of June... and since there is a back log, there's no guarantee.

USDA charges a "Funding Fee" - similar to the Upfront MIP that FHA charges, and the Funding Fee VA Mortgage Loans have (for more information on Funding Fees click here).  The actual fee has been 3.5% - and the US Government has been "subsidising" the fee so that the consumer only paid @2%.

With the new money - comes higher "Funding Fees" - the new Funding Fee paid by Consumers is 3.5%.  This means that is you purchase a $100,000 home - your loan amount is $103,500. There's not a monthly charge for PMI, and there's no REFUND if you pay your home off early... but the interest on that additional $3,500 is tax deductable!

If you want to know more about qualifying for a USDA Home Loan in NC, click here.

Many people are trying to get their tax credit by having their loan approved by USDA by the end of the month... to those folks I would urge extreme patience.  We've lost almost 3 weeks -with a huge number of files waiting for USDA review.  It's going to be a tight wire finish.  If your file is not already approved by your lender and TO THE USDA office in NC by the 5th of June - I think you might lose this credit.  It's just my opinion - but I would be doing everything I could to get my file to the USDA office FAST.  Then it's a waiting game.

We specialize in USDA Home Loans in NC.  If you are interested in getting qualified for a USDA Mortgage Loan, or you are ready to refinance a USDA Home Loan, please call Steve and Eleanor Thorne, FFSi, 919-649-5058

 

 

 

 
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6 Comments on We're Back In The Money Baby! Go #USDA!

MAY
28
2010
639,271 Points 39 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

Great news Eleanor, but as you said we're all holding our breathe to see if they will be able to get through the pile of work that needs done to close!  Thanks for the update!
10:25am • #1
420,530 Points 22 Featured Posts Outside Blog Hit Router Attended Rain Camp Called Shot Master

Eleanor,

I found your post via google this morning, btw!!!!

I have a client waiting on RD money in Oklahoma. She is already IN underwriting - just waiting for more funds to be reallocated. So, does this mean she will need to come up with another 1.5% for down payment?

I am actually on vacation this weekend, so quickly checking computer before getting back on the road. Would you be so kind as to e-mail me with an update? lcain@tulsarealtors.com

Thank you so much! You have made my day and my Buyer's day!!

Lori Cain
10:25am • #2
215,481 Points 28 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

Lori!  Thanks!  She will not have any downpayment - however her loan amount is now HIGHER.  Again, the Funding Fee is like PMI (or MIP for FHA or Guarantee Fee for VA loans).  It's added to the "base loan" amount.  I think she needs to know TWO THINGS.

1.  She needs to sign new paperwork with new loan amount reflected on all docs.  Companies will require that the new loan amount be re-underwritten internally and then sent to USDA for underwriting.

2.  In North Carolina Mortgage Brokers fall under the 5% High Cost rules.  If that is the same in Oklahoma - it will be difficult if not IMPOSSIBLE for Brokers to close USDA loans.  The 5% rule takes Attorney Fees, Title Insurance, Underwriting Fees, AND the 3.5% into the equation.  She needs to check on this ASAP.

Good Luck!

-E.
11:06am • #3
648,311 Points 63 Featured Posts Localism Sponsor Outside Blog Called Shot Master

Its great news - but cutting things very, very close to the wire for the tax credit.
11:34pm • #4
MAY
29
2010
420,530 Points 22 Featured Posts Outside Blog Hit Router Attended Rain Camp Called Shot Master

Thanks Eleanor - I will get on this first thing Tuesday morning!!
10:12am • #5
215,481 Points 28 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

With the change to 3.5% - and the "High Cost" Predatory Lending rules in NC... I think we are going to see more Sellers paying the 3.5% Funding Fee.  It will be the only way Brokers can make their income.
3:19pm • #6


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Eleanor Thorne 919-649-5057 Cary Mortgage Loans

Cary, NC

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Steve Thorne NC Mortgage Experts

Address: 111 Corning Road, Suite 230, Cary, NC, 27518

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