Have you thought about buying a home, but are worried that you don’t make enough to qualify for a large enough loan? Are you worried that the monthly payment will be more than you are comfortable spending?
If you’ve been frustrated by the process of trying to buy a home, there is an answer that has helped many of our neighbors in Fremont County become homeowners.
That program is RD Direct from the U.S. Department of Agriculture (USDA).
The RD Direct program is income-based and is specifically designed to help low-income and very-low-income applicants find “decent, safe, and sanitary housing” in rural areas like ours.
In addition to offering lower interest rates, the RD Direct program offers payment assistance as well as longer terms to repay the loan (up to 38 years, depending on your income level). Between the lower interest rates and longer repayment terms, your monthly payments can be significantly lower than with a conventional loan.
Payment assistance is determined by the adjusted gross income of the applicant, so the less money you make, the more assistance you might be able to get. With this short-term subsidy, you have a greater ability to repay the loan. Additionally, you can often qualify for an amount for a home when the same home would be difficult or impossible to buy with other loan programs.
In other words, many people can become a homeowner under the RD Direct program that wouldn’t be able to otherwise, and that’s a good thing!
RD Direct isn’t just a program to finance an existing home, either. RD Direct funds can be used to build a new home, repair and renovate an existing one, relocate a home to a new homesite, and prepare home sites for a home, such as installing water and sewage facilities.
Better still, most RD Direct loans require no down payment, which saves you thousands of dollars right off the bat.
A recent client of ours, Molly, was able to fulfill her dream of buying a home by using the RD Direct program.
Molly qualified for a conventional loan through a local bank, but the amount was far too low for the type of home she needed in Lander for herself and her three children.
Fortunately, Molly had good credit and a reasonable debt load, and was able to qualify for a much larger amount with RD direct. In fact, not only did she qualify for more money, but it was enough to finance a four-bedroom, two-bath home in Lander.
Furthermore, Molly had been paying $1,200 per month in rent in addition to electric bills that sometimes ran over $500 per month due to the home’s all-electric heat. With her RD Direct loan, her mortgage payment is less than half of what her monthly rent was! Her heating bills are far lower too because her new home has forced air gas heat.
RD Direct made buying a home a reality for Molly while also giving her financial relief with a much more manageable mortgage payment. As her situation shows, you really can own a home – it isn’t just a dream! Often the key is simply being informed about the programs that are available in our area.
If you’re ready to buy a home and have questions about home loan options, give us a call at 307-856-3999. We’re here for you to help you find the assistance you need to make your homeownership dreams a reality, just like Molly!