100% financing mortgage is still available!
100% Financing is available in WNY!
Yes it is true Western New York!
A no down payment, 100% financing mortgage is still available in Western New York! No, it is not a typo… it it’s not a VA mortgage….it’s the USDA Rural Development Housing Loan Program.
Don’t let the word “Rural” fool you. In this program, the word rural is used very loosely, for it incorporates many new suburban areas throughout the country! See if the home you want is eligible here.
The program is designed to provide more opportunities for families to purchase a single-family home or condominiums in specific outlying areas around our existing cities and towns. Thus promoting the growth of these semi rural areas.
In addition to the actual location of the Western New York home, the borrowers must also meet household income requirements based on 115% of the HUD median income limit. The actual income is based on the county and number of people in living in the home. For example, in western New York, a family of 4 living in Niagara or Erie County must have a total income less than $70,750! If the income is above this threshold, deductions can be made for each child under 18, full time students, disabled or handicapped adults, and 100% of child care costs for children under 12.
Clearly Joe the plumber would probably qualify!
This program also allows the WNY borrower unlimited seller concessions as well as increasing their loan up to the appraised value. In doing so they would then be able to do repairs or upgrades. For example, if a WNY buyer purchases a home for $106,00, with seller giving back $6000 in concessions (funds are used to pay the buyer closing costs) and the house appraises for $115,000. The buyer can finance and additional $9000 in rehab money!!
These loans are all 30 year fixed rate products and do not require private mortgage insurance. There are no minimum credit scores, but as the score increase the documentation has a tendency to decrease. Thus common sense underwriting is applied, looking at all of the specifics of a borrowers situation.
Program Benefits
- 100% financing based on appraised value
- No monthly PMI, 2% guarantee fee is financed
- No down payment required, no reserves required, no limit on seller concessions
Borrower Eligibility
- Not limited to 1st time home buyers
- 29/41% ratios
- 2-year employment history required for primary income
- 12 month history required for part-time, overtime, bonus income
Credit Guidelines
- No FICO minimum
- Late payments 1×30 past 12 months OK with explanation
- Bankruptcy/foreclosure must be completed for 3 years
- No collections or judgments in past 12 months unless 620+ credit scores by exception only
Property Requirements
- Primary residence, single family or PUD only
- Property must be RD eligible
- Borrowers may not own other property
- No manufactured housing
- Inspections required: well/septic/termite
- 100% of repairs may be financed on as-improved value; if not completed at closing, escrow of 150% of costs will be required
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