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Keal Cleveland

New Financing Option for Buyers with Borderline Credit Scores

I spoke with a lender today who has 100% financing available for buyers with credit scores of 580 and above.  The program also allows a seller to pay up to 6% towards a buyer's closing costs - a great deal for first time buyers.  It is through the USDA and the property must be in an approved area.  It doesn't work for Dallas County, but there are areas in Tarrant County that qualify.  Both existing homes and new homes work as long as they are in the approved-target areas.  There are some great communities that fall into these zones. 

 Email me for more details.  If your credit score is close to but below 580, this lender has a team that can help raise it in as little as a month depending on your situation.

 Keal

Published Tuesday, March 03, 2009 11:03 AM by Keal Cleveland

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Mike Mccoy said:

Keal,

I wanted to comment on your recent posting on the USDA program - and possibly shed some additional light on this program.

PROGRAM HIGHLIGHTS

-  per RD guidelines, there is no minimum credit score requirement. However, most lenders are requiring a 620 minimum score. With good compensating factors, a credit exception may be obtained to overcome the credit rating.

-  This program is manually underwritten, much like the old FHA programs. This is good and bad - strict housing ratios cannot exceed 29% (PITI), and Debt to income ratio cannot exceed 41%. Now, this is where the good comes in - exceptions can be made if the borrower's ratios do not fit in this box.

-  Income limits = 115% of HUD median Income

-  Much like FHA, RD has a Guarantee Fee of 2% of the loan amount.

-  There are no limits to seller contributions. Although some lenders are limiting to 6% maximum.

-  Fixed Interest Rates = 30 year notes

-  Home must be in RD approved areas = see link below to find out if your home is in this area.

http://eligibility.sc.egov.usda.gov/elegibility/welcomeaction.do

As you might have noticed, I am a mortgage lender and have seen many of these.

Please email me should you have any additional questions/concerns.

Mike McCoy

mmccoy@paramountmtg.com

March 5, 2009 4:10 PM

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