Home Buying in 48197>Question Details

Felicia, Home Buyer in Canton, MI

Rural Development Loan Options

Asked by Felicia, Canton, MI Fri Dec 12, 2008

I found some more information about the rural development loan and it appears that I might qualify for guaranteed loan. Does anyone know if these loans can be used for property improvement? Currently we are looking at an FHA 203K loan. But the rural development loan is more attractive because of no down payment, and no mortgage insurance. Any information provided is greatly appreciated.

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the property is covered. I checked on the site already. I guess I will have to decide if I want to put an offer on it with FHA 203K. The house doesn't have a furnace which would make it ineligible for a rural development loan. I was thinking instead of asking for a 6% concession I would ask for the bank to put in the furnace. Not sure how that would go.
0 votes Thank Flag Link Fri Dec 12, 2008
Oops.

Guess you need to start from the begining http://eligibility.sc.egov.usda.gov/eligibility/welcomeActio…
0 votes Thank Flag Link Fri Dec 12, 2008
Felicia,

Perhaps I'm mistaken, but the map on this website indicates properties may be ineligable for USDA rural development loans in the 48197 zip code. http://eligibility.sc.egov.usda.gov/eligibility/eligibilityA…

I suggest entering the actual property address below the map.
Web Reference: http://mi-living.com
0 votes Thank Flag Link Fri Dec 12, 2008
Hi Felicia,
No, Rural Development loans cannot be used for improvement. The home needs to be inhabitable and free of health and safety hazards prior to moving in.

203k is really all there is out there for a low down payment on a home needing repairs.

If you are concerned about down payment and you are using FHA 203k then you should be aware that after Jan 1st the required down payment is getting bumped up to 3.5%. This means you would need to have an offer accepted, a loan locked in, and an FHA case number assigned prior to Jan 1.

If you're doing 203k then you dont have a lot of time left since you'll probably need to get all your builder estimates and everything early in the process

Tony
0 votes Thank Flag Link Fri Dec 12, 2008
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