USDA Home Loan Program
One of the greatest myths about buying a home today is that you need excellent credit and have to make a sizable down payment. While this is true for almost every mortgage program in the county, there is one exception to the rule, the USDA loan program. The USDA home loan program is one of the only home loan programs in the country that requires absolutely no down payment. The only upfront costs associated with USDA home loans are closing costs and the mandatory 2% funding fee, which can be financed into the overall amount of the loan. The USDA home loan program also has flexible credit requirements, compared to most other home loan programs, and only requires a minimum credit score of 640.
USDA Home Loans in Maryland
Currently, there are tons of great USDA home loan opportunities in the state of Maryland. Some USDA eligible Maryland cities include Eldersburg, Hampstead, Manchester, Mount Airy, Sykesville, Taneytown, just name a few. There are also many areas not too far outside of Baltimore and Camden that are USDA eligible. For an area to be USDA eligible it must either be located in a Maryland rural area, or be located in a town with less than 10,000 residents. However, some Maryland communities are USDA eligible with up to 25,000 residents, depending on that counties own restrictions. Also, all USDA eligible properties must be modest is size and cost and are only eligible for low to middle income households.
Maryland USDA Loan Income Requirements
In order to qualify for USDA Home Loans in Maryland, your income must be within the program’s income limits for your particular area. To be eligible for a USDA home loan your total household income must be within 115% of the average household income for the area that you’re choosing to live in. If your total household income is over this threshold, you will not be able to qualify for a Maryland USDA home loan. However, if your income is just barely over this 115% threshold there are several deductions in place that can help to put you below this limit.
These deductions include:
1. A $480 deduction for each minor child under 18 years of age
2. A $480 deduction for each disabled or handicapped household member who is not the applicant or co-applicant
3. A $480 deduction for each full time student 18 years or older
4. A $400 deduction for each elderly family member 62 years or older
5. Deductions for medical expenses for any elderly family member
6. Deductions for child care expenses for children 12 years old or under
Maryland USDA Credit Requirements
While Maryland USDA home loans have some of the most lenient credit requirements out of any other home loan program in the country, you will still need a minimum credit rating of around 640 in order to qualify. However, there are a few USDA lenders out there that may go as low as 580 as long as you have steady income and can prove your low credit score is due to circumstances beyond your control.
