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USDA Repair, Rehab, and Renovation Loans.
0% Down, 6% Seller Closing Credit Allowed
Buy and fix a house in a designated USDA eligible area with no money down
USDA Renovation Loan Program Benefits
- 100% Financing No Money Down USDA Renovation Loan Program
- The USDA Renovation Loan program allows USDA eligible borrowers to create one loan amount, including a repair escrow budget to finance renovation and rehab projects (including major structural repairs), which can be combined with the purchase price
- Repairs are made after settlement, so there will be no delays on a transaction closing due to appraisal mandated repairs
- Greater appraised value, as the USDA Appraiser will determine the property value based on the “after-completed value” Vs. the current “as-is value”
- Lower Monthly Mortgage Insurance or PMI, compared to a comparable FHA Renovation Loan
- Flexible credit requirements, with credit scores down to 640
- Safe, secure 30 Year fixed rate mortgage
- With seller help, no out-of-pocket closing costs
- Most property types allowed
USDA Renovation Loan Qualification Requirements
- Property, including projected repairs from the Contractor Proposal, must meet USDA appraisal guidelines
- HUD Consultant:
- Not required if total repair/rehab budget is less than $35,000 and no structural repairs required (Limited)
- Required if total repair/rehab budget is greater than $35,000 and/or structural repairs are required (Standard)
- Renovations must start within 30 days of settlement and be completed within six months
- A third-party USDA Renovation Loan Contractor must complete all repairs
- All borrowers on the loan must have a minimum 640 middle credit score
- No foreclosure, short-sales, or Chapter 7 bankruptcies permitted within the last three years
USDA Renovation Loan Eligible Repairs:
- Eligible Repairs:
- Removing safety and health hazards
- Making the dwelling accessible to persons with disabilities
- Repair or installation of septic system and water wells
- Additions or structural alterations
- Modernization (kitchens and bathrooms, interior floor cover, exterior siding, etc.)
- Installation of energy conservation or weatherization feature
- Repairs to existing swimming pools, hot tubs, or saunas
- Repairs to accessory dwelling units
- Ineligible Repairs:
- Installation of new inground swimming pools, hot tubs, or saunas
- Repairs to new or existing manufactured homes
- Repairs to condominiums
- Converting structures to SFH dwellings (barns, schoolhouses, etc.)
- Alterations that allow income-producing features
- Installation of luxury items (exterior fireplaces and kitchens, etc.)
- Repairs or improvements to common space areas (community meeting rooms, playgrounds, etc.
- Any repair/removal/remediation of Oil Tanks
- Tear downs to foundation and rebuilds are not permitted
- Ineligible repairs for transactions below $35,000 (Limited Transaction):
- Structural Modifications
- Any repair/removal/remediation of Oil Tanks
- Any repair/installation for private water systems (Wells)
- Any repair/installation for private waste management systems (septic systems, lagoons, cesspools, pits, etc.)
- Mold remediation
Talk to a USDA Repair, Rehab, and Renovation Mortgage Expert
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Today's USDA Repair, Rehab, and Renovation Loan Interest Rates
USDA Repair, Rehab, and Renovation Loan interest rates change on a daily basis.Â
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