The economy has caused many to question the benefit and logic of home buying. Why get stuck in such a big commitment? How can anyone afford to save for the down payment requirements of conventional loans, today? And whose credit would really pass any lender’s standards in these days of financial upheaval?

Believe it or not, homeownership is still achievable. Government-backed loans and low-down mortgages help millions to purchase a home at an affordable price. With the USDA home loan, those interested in rural and suburban living can buy a home with no money down, low interest rates and 100% financing.

The U.S. Department of Agriculture guarantees the rural housing loan for low- to middle-income families and farmers. But don’t let that fool you! Rural and suburban USDA borrowers are getting beautiful single-family homes, not just farmhouses.

The loan boasts some of the lowest foreclosure rates than all market subprime fixed rate loans, today. That success rate has a lot to do with the affordability of the loan. The USDA loan has low monthly payments on top of the $0 down payment and low closing costs benefit.

Other reasons the loan is successful might be…

 Funds from loan covers the 2% guarantee fee, so almost no out-of-pocket costs.
 No Monthly Mortgage Insurance. Although, the loan does have a small annual fee (0.3%).
 No credit explanations on application for a 640 or above credit score.
 No cash reserves required.
 Repairs, upgrades and renovation can be financed with loan funds.
 Very competitive rates (set by underwriting lenders).
 30-year fixed rate.
 The loan covers locations with a population under 20,000. However, the USDA has extended the eligible areas closer to metros. Many areas right outside of Reno, Sparks and Carson qualify for the loan.
 Cheaper utility bills due to the Department’s promotion on energy efficient and sustainable homes.

To make homeownership a reality for low- to middle-income borrowers, the USDA home loan eligibility requirements are quite lenient. In fact, eligibility will depend on only three pre-requisites:
• Select a home within an eligible USDA area.
• Have an adequate source of income for monthly mortgage payments (The standard debt to income USDA ratios are currently 29/41%).
• Have an income up to 115% of the area’s median level.

Most lenders will want applicants to have a credit score of 620 or higher. However, USDA specialists still encourage ones with lower scores to apply. Lenders look at a number of qualifying factors, and the applicant’s ability to pay will be given the mot thought. A USDA loan expert might also be able to work with interested borrowers and get them on the right track.

Jasmine Reese is a USDA loans.com writer, blogging about the benefits of purchasing a home with the USDA mortgage program. USDA loans.com is USDA approved home loan provider Guaranteed Rural Housing Loans.