Rural Development “RD” LoansObjectiveTo provide safe pdf

1 Rural Development “RD” Loans Objective To provide safe, well-built, affordable, beautiful homes in rural areas for Americans. Summary The Rural Development Home Loan is a 30 year fixed rate loan available for low to moderate income families who are looking to buy, build, improve, repair, or rehabilitate homes in rural areas. If a buyer has had ownership of a primary residence in the last three years, they are not eligible for the program. To qualify for a Rural Development loan buyers must meet the MSHDA (Michigan State Housing Development Authority) sales price, income limit, and first time home buyer eligibility guidelines. All adult members of the new home must apply jointly for the loan. The Rural Development loan is known as the no money down home loan. This is because applicants can borrow 100% of the home’s cost! The Rural Development Loan is the only zero down loan offered to those who have not served in the military. The maximum amount guaranteed by Rural Development can include closing costs, prepaid/escrow items, and the RD guarantee fee. Most Rural Development Loan applicants receive almost all of their earnest, also known as good-faith deposit, back after closing. However, the maximum loan amount cannot include repairs and/or improvements to the property. Treadstone Funding 616.774.9160 2 Who applies for a Rural Development Loan? • Those wanting to stop renting and buy a home with zero down. • Families and individuals looking for their first home. • People in rural areas. What areas are considered Rural Development Areas? Rural Development Loans are offered in areas with a population of 20,000 or less people. Find maps of Non-Rural Development areas in Michigan starting on page 8 What Properties are eligible? • New homes or builders’ models that have not been previously occupied • New condominiums approved by the FNMA or FHLMC • Existing homes that have been previously occupied • Existing Condominiums that have been previously occupied. • New manufactured homes approved by RD. **All must be in Rural Development Areas** Treadstone Funding 616.774.9160 3 Income Limits Household income cannot exceed 115% of the median household income of the area. A family of 1 – 4 cannot exceed an income of $74,050 A family of 5 – 8 cannot exceed an income of $97,750 Contact us to find out if you qualify Sales Price Limits Contact us to find out the current price limitations. Or find them online at: www.michigan.gov/mshda Occupancy Requirements Borrower(s) must occupy the property within 60 days of closing. Treadstone Funding 616.774.9160 4 Loan Specs Loan / Grant Direct Loan. 30 Year Term Terms / Conditions Loan amortized for 33 years. Applicant may be eligible for payment assistance. Minimum Loan Amount There is no minimum loan amount Third Party Contributions Contributions are allowed but subject to approval by Rural Development guidelines. This means, if the seller or a Real Estate Agent wants to contribute to the buyer’s closing costs they can. The contributor must be the seller, realtor, or any person involved in the home buying process. At Treadstone Funding we excel in assisting you in your home buying process. We have Rural Development Loan experts who are willing to answer any questions you may have about the Michigan RD Loan process. Take advantage of our assistance and call us today! Just ask for an RD Loan Officer. (616)-774-9160 Or visit our website at www.treadstonemortgage.com Treadstone Funding 616.774.9160 5 The Rural Development Loan in Real Life Treadstone Funding – Kevin Polakovich In 2011 Amy, a recently divorced mother of three children, came into our office after hearing about Treadstone Funding from a friend. She had spoken with one of our Loan Officers on the phone and was in the office to talk about her situation and the best loan program for her. Amy walked into our office on a Tuesday afternoon, was greeted by our receptionist and waited patiently in our conference room for someone to meet with her. Amy’s husband had refinanced their home in his name leaving her with no home and very little credit. At first Amy was turned off by the recommendation of the Rural Development Loan but she soon discovered that rural really is not as rural as it sounds. She found a great four bedroom home near the city and in a great school district. Our team at Treadstone was able to get Amy a zero down home loan at a fixed rate close to four percent just three weeks after she stepped into our office. Two things made this home buying process quick, easy, and affordable for Amy. The Rural Development Loan allowed Amy to pay no application fee, no appraisal fee, and no closing costs as well as the return of Amy’s earnest money. The second thing that made this process smooth was the Treadstone team. Treadstone is constantly one of the top Rural Development Lenders in the state. The Rural Development program is very under-utilized by many big banks but Treadstone is determined to have more great home buying stories like Amy’s. If you think the RD program could be the loan for you give us a call. We are happy to answer any questions you have regarding all home loans. Treadstone Funding 616.774.9160 6 Treadstone Funding – Brendan O’Driscoll During the end of June 2011 Keith gave James, a Treadstone Loan Officer a call regarding the home of their drams. Keith, who was married and a father of three kids, had found a just finished home in Jenison, Michigan. The home had four bedrooms, was in a great school district, and had the perfect yard for a Fourth of July family party. Keith explained the circumstances of his current lender hindering the ability of Keith and his family moving into their dream home. Keith’s current lender could not get the loan closed. After talking to James, Keith discovered not only was his current lender taking their time on closing but he was also missing out on a great loan program. James suggested the Rural Development program to Keith. Keith had no idea he could be buying a home with zero money down! Keith assumed his home did not qualify for Rural Development because Jenison did not seem like a rural area and he assumed his income was too high to qualify. The great thing about the Rural Development program is that income is based off of the number of family members. Keith was within the $100,000 income limit of a five person family and to his surprise, the Rural Development program only excludes a slam portion of Michigan. James was able to get Keith’s loan closed in two weeks, in perfect time for a Fourth of July celebration. Keith also was able to get $800 of their $1,000 in earnest money back after closing! The Rural Development program is very under-utilized by many big banks but Treadstone is determined to have more great home buying stories like Keith’s. If you think the RD program could be the loan for you give us a call. We are happy to answer any questions you have regarding all home loans. Treadstone Funding 616.774.9160 7 Let Us Know How We Can Help Treadstone Funding has helped first time home buyers realize the dream of leaving that rental behind, and owning a house. Whether it’s conventional lending, an FHA program, VA loan, Rural Development or a 203k mortgage loan, the team at Treadstone is here to find the right mortgage for you. Treadstone Funding is a full service residential mortgage lender. We’re easy to find. The website: www.treadstonemortgage.com We’re on other social media sites as well. Copyright Notice & Legal Notice ©2011 Treadstone Funding 25 Commerce Grand Rapids, MI 49503 Feel free to share this eBook (FOR FREE) with anyone you want to. All rights reserved. While attempts have been made to verify information provided in this publication, neither the author nor the publisher assumes any responsibility for errors, omissions, or contradictory information contained in this document. This document is not intended as legal, accounting or investment advice. The reader of this document assumes all responsibility for the use of these materials and information. Treadstone Funding 616.774.9160 8 Treadstone Funding 616.774.9160 . 1 Rural Development “RD” Loans Objective To provide safe, well-built, affordable, beautiful homes in rural areas for Americans. Summary The Rural Development Home Loan. areas. What areas are considered Rural Development Areas? Rural Development Loans are offered in areas with a population of 20,000 or less people. Find maps of Non -Rural Development areas in Michigan. of the home’s cost! The Rural Development Loan is the only zero down loan offered to those who have not served in the military. The maximum amount guaranteed by Rural Development can include