The USDA Rural Development loan is a great option for Louisiana Homebuyers.
The USDA Rural Development Loan is one of the last loan programs that will allow you to buy a home without a down payment. Regardless of what you may hear in the media, you do not have to have a perfect credit history to qualify for this no down payment loan program. In fact a Louisiana homebuyer can qualify for a USDA Rural Development loan in as little as 2 years after a hardship event that impacted their credit score.
The Louisiana Rural Development loan requires a minimum middle credit score of 640, although there are some circumstances that would allow for a score down to 620. The guidelines also require a 2 year work history. While the buyer is not required to have the same job, or work for the same employer for 2 years, they do need to show 2 years in the same line of work. Recent graduates working in their field can count their time in school, as time on the job.
The Louisiana Rural Development loan has two requirements not present with other loan programs.
The first restriction limits the amount of money that can be earned by all the members of the household, even those not on the loan. The program considers the income of each member of the household when calculating the annual or “too much” income. Here is a link to calculate your income to see if you qualify. However, roughly speaking, for family’s with 1-4 members the annual income limit is around $74,750 and family’s with 5-8 members the limit is around $98,650 per year. Please note, that if your family income is slightly over, there are calculations that we use that can allow us to reduce your calculated income for certain expenses, be sure to give us a call before deciding you make too much money for the Rural Development Loan.
The other restriction has to do with geography, where the home is located. Louisiana has 10 cities that have ineligible areas. If you are wanting to buy in Shreveport, Ruston, Monroe, Alexandria, Lake Charles, Lafayette, Baton Rouge, New Orleans, Slidell or Houma, you can give us a call and we can check the address for you, or you check the address of a property for eligibilty on the USDA website here
All other areas of the state of Louisiana are currently eligible for the Rural Development loan.
Give us a call today, we will be happy to help you get Pre-Approved with a RD loan to purchase your new home with no down payment.