USDA Rural Development financing will get more expensive on October 1, 2014 when the annual fee will increase from .40 to .50. This is not a big increase, but USDA financing has tightened up over the last year, and this will just make it that more difficult to qualify.
If anyone has figured out over the last year, USDA has tightened up on what they will now approve a borrower for when using their automated underwriting system, GUS. In the past I had no problem getting a borrower qualified for a house payment that was 36% of their gross income. The last few attempts at getting a borrower qualified through GUS kept me as no more thant 32%.
With home pricing going up, and qualifying getting tougher, the use of USDA as an option for home buyers is becoming less of an option for my marketing area of Ukiah, CA. in Mendocino County, CA.
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