Is the USDA Rural Development 100% loan the solution to you becoming a homeowner? Today we will be looking at the pros and cons and unique advantages these programs offer homebuyers. We will be giving examples of how others have used the USDA Rural Development program and some other services and help the USDA Rural Development offer.
What do YOU want to accomplish with YOUR mortgage ? Let’s explore the financing options YOU have to get to the life you want. Connect with me at www. JoGarner.com or call at 901 482-0354
To Your Success,
Jo Garner, Mortgage Loan Officer NMLS#757308 Sierra Pacific Mortgage NMLS #1788 Memphis, TN
To hear the audio of today’s show click below:
Let’s open the show!
Good morning, Memphis! Welcome to our internet listeners and podcast listeners across the 50 states! You’re on Real Estate Mortgage Shoppe. I’m your host, Jo Garner, Mortgage Loan Officer. You can connect with me at www.JoGarner.com. Make your plan. Let’s work your plan. If the deal works for you today, let’s do it today. Our general topic is How To Use The Advantages of the 100% Rural Home Loan. Call us while we are live today March 19th, 2022 at 901 535 9732
INTRODUCING DAVID CORWIN, DEPUTY DIRECTOR OF RURAL DEVELOPMENT /USDA LENDER & PARTNER ACTIVITIES
In the studio for the first time on Real Estate Mortgage Shoppe we welcome David Corwin, Deputy Director Lender and Partner Activities for Rural Development and USDA. David, your career with USDA Rural Development began in 2009 and you have experience with several agency programs. In your current role with National Headquarters you direct the efforts of marketing, training, and outreach for lenders and partners of the Single Family Housing Guaranteed USDA Rural Housing Loan Program. Take a minute or so to introduce yourself and talk about what Rural Housing and the USDA loan programs do for the real estate industry and their customers. (David has about 1 min or 1.5 min to introduce himself and talk about what USDA and Rural Development does for the real estate industry and homebuyers)
ZERO DOWN GIVES JERRY AND JANIE JAKINS THE TURN-AROUND THEY NEED TO OWN THEIR HOME
(Jo ) For Jerry and Janie Jakins it seemed like all they did was work and pay bills, never getting ahead. Just as they would get a raise, the landlord would raise the rent again. They put together plans to move out of the city and buy a house in the county closer to family. But, the Jakins had very little money saved. “I just want out of the city,” Janie told me. “If Jerry and I can buy a home close to where some of my family lives, we could relax on our patio at night and breath the fresh air. Jerry could go fishing down the road with some friends of ours.”
The first lender they talked to said they needed to save over $15,000 for a down payment and closing costs to get a house because it was a seller’s market and no one would pay their closing costs for them. It seemed their dream of owning their own home was doomed for another day- long into the future.
Then one of their family members connected the Jakin’s with me. We started exploring the areas where they wanted to live and discovered that the homes in that area were eligible for the 100% USDA Rural Housing loan program. The Jakin’s income was within the acceptable guidelines for the USDA loan. Since the USDA loan required no down payment, Janie and Jerry had enough savings to cover the closing costs on their own.
One unique aspect of the 100% Rural Housing loan is that if the appraisal value is higher than the sales price, USDA will allow the borrowers to roll in reasonable closing costs up to the appraised value. This would allow the Jakin’s to keep more of their hard-earned savings for emergencies and for fixing up the house.
When we compared the FHA loan with the Rural Housing USDA loan, Janie and Jerry felt very proud of themselves for finding and choosing the 100% USDA loan. Not only did the USDA loan get them into their home with 100% financing, but the upfront fee added to the loan was only one percent of the loan amount vs 1.75% added to the FHA loans. The monthly USDA fee was a lot less than the FHA monthly fee too. Jerry and Janie talked excitedly about their move from the city to their new home in the country’s fresh air.
You can use the USDA 100% financing to purchase a primary residence for a single-family home, condo, land (if you are building a home right away) and a manufactured home. You can also use the USDA Rural Development loan to refinance your home. Vacation homes, investment homes and multi-unit homes are not eligible. There are restrictions on the USDA home loan programs. There are household income restrictions. The property must be in an acceptable area determined by population. Income-to-debt ratios are stricter on 100% USDA loans than on other loan programs.
There are pros and cons to using the 100% USDA loan program which we plan to cover later in this show.
What do YOU want to accomplish with YOUR mortgage. Make your plan. Let’s work your plan. If the deal works for you today, let’s do it today. Connect with me and let’s explore some financing options available to to you. www.JoGarner.com
(Jo) David Corwin of USDA Rural Development, please give us an overview of the USDA Rural Development home loan programs before we go to our 9:15 am break. We can continue when we come back from break (David will probably have about 1 to 2 minutes before we go to advertising break at 9:15am)
You’re on Real Estate Mortgage Shoppe. I’m your host, Jo Garner, Mortgage Loan Officer. Make your plan. Let’s work your plan if the deal works for you today, let’s do it today. When we come back, David Corwin, of USDA Rural Development will be talking about some of the loan programs that could be the answer to you getting the home you want. Pat Goldstein of Crye-Leike will be sharing some tips with us too.
(2nd segment starts at 9:18am )
TALK SHOPPE BUSINESS TIP FOR REAL ESTATE PROS
2nd segment after 9:15 advertising break – (producer to start the song “Taking Care of Business” by Bachman Turner Overdrive –but bring the volume down before the lyrics start) It’s time to talk shop with Talk Shoppe’s Business Tip For Real Estate Professionals. Talk Shoppe is a marketing company offering free education and networking to anyone interested in real estate or in business and health and wellness. Talk Shoppe is made possible by the financial support of its sponsors. For more about Talk Shoppe, go to www.TalkShoppe.com (shoppe) For our Talk Shoppe Business Tip today we have Talk Shoppe realtor Pat Goldstein with Crye-Leike Realtors. Pat, you are known as the “Gold Standard” in real estate and you serve your home buyers and sellers in West TN and North Mississippi. Pat Goldstein, realtor with Crye-Leike, what is our Talk Shoppe business tip for real estate pros? (Pat shares tip about 1 minute)
PAT GOLDSTEIN, REALTOR 901 606-2000
Pat’s tip: If you want to know if a property is eligible for USDA financing, google “USDA property eligibility” and plug in the address. The tool will give you a good indicator if the property is in the geographical area accepted by USDA.
TOPICS COVERED BY DAVID CORWIN, DEPUTY DIRECTOR USDA, RURAL HOUSING HARRISBURG, PA
TOPICS COVERED BY DAVID CORWIN :
Program Overview – Well built, affordable housing is essential to the vitality of communities in rural America. Rural Development’s Housing Programs give families and individuals the opportunity to buy, build, or repair affordable homes located in rural America. The Section 502 Guaranteed Loan Program assists approved lenders in providing low- and moderate-income households the opportunity to own adequate, modest, decent, safe and sanitary dwellings as their primary residence in eligible rural areas. Eligible applicants may purchase, build, rehabilitate, improve or relocate a dwelling in an eligible rural area with 100% financing. The program provides a 90% loan note guarantee to approved lenders in order to reduce the risk of extending 100% loans to eligible rural homebuyers – so no money down for those who qualify! Eligibility for these loans, loan guarantees, and grants is based on income and varies according to the average median income by county.
Single Close Construction – The single close loan process is utilized to close both the short term construction loan and long term permanent home loan simultaneously. The interest rate is fixed for both loans and the borrower only needs to sign one set of loan documents. The single close offers two payment options during construction, interest only or full PITI, and either can be escrowed along with a contingency reserve up to 10% of the cost of construction. The Loan Note Guarantee is issued after this closing, and the lender is protected before a shovel goes in the ground. Approved lenders must have appropriate construction lending experience and adequate controls for interim construction cost disbursements, but do not require any additional approval process through the Agency.
Manufactured Housing and Pilot – The Guaranteed Loan Program allows for the purchase of new manufactured homes, single- or multi-width units, placed on permanent foundations built to FHA guidelines (HUD Handbook 4960.3). Currently, an Agency Pilot program is in effect which allows for the purchase of existing manufactured units, on permanent foundations that meet HUD requirements, built Jan 1, 2006 or newer. States included in the pilot are: CO, IA, LA, MI, MS, MT, NV, NH, NY, ND, OH, OR, PA, SD, TN, TX, UT, VT, WA, WV, WI, and WY.
Interested applicants can apply for a Section 502 Guaranteed Loan through USDA Rural Development’s network of approved lenders. These approved lenders are also your point of contact for any questions or scenarios you wish to have reviewed for possible eligibility. A list of active lenders, searchable by state, can be found here: https://www.rd.usda.gov/sites/default/files/RDGRH-AllStatesList.pdf . Interested lenders can reach out to us at email@example.com .
For more information, visit our website at: https://www.rd.usda.gov/ .
(3rd SEGMENT starts at about 9:34am )
TOPICS COVERED BY JO GARNER, MORTGAGE LOAN OFFICER:
What are the requirements for getting the 100% USDA loan?
The property must be in a rural area with not-so-densely populated areas. You can google usda home loan property eligibility and plug in an address and the website can tell you if the property is in an eligible area.
The property is for a primary residence and not for commercial use. No working farms are other commercial uses are allowed.
The property needs to be in good repair—structurally sound, sanitary and secure.
The borrower must have the ability to repay the loan.
Stable income is required
Acceptable credit (lenders generally require a credit score of 640 or above, but this can vary according to the lender)
Income-to-debt ratios around 41% or less depending on other factors (the housing ratio and debt ratios are much stricter on USDA loans than other products)
The borrower does not have to be a first-time homebuyer
USDA has a maximum household income limit which is determined by the location of the property. (income from all adult household members, even non-borrowers are calculated to determine “household income.” Household income is not to exceed 115% of your area’s median income.
USDA Loan Mortgage Insurance Fees
Advantages to using the USDA Rural Housing Loan:
Zero down payment
If the appraised value is higher than the price of the home, you can include reasonable closing costs into the loan up to the appraised value
The mortgage insurance is lower than what you would pay using an FHA loan.
Disadvantages to using the USDA Rural Housing Loan:
Mortgage insurance remains on the loan for the life of the loan. Each year the remaining balance of the loan times .35 divided by 12 months.
Household income restrictions.
Stricter guidelines on the percentage of the house payment to income and debt-to-income ratios.
Remember the story of Jerry and Janie Jakin earlier in the show.
Go through the advantages and disadvantages of the program and the reasons the USDA loan worked for the Jakins.
4th segment 9:47am REAL ESTATE TIP OF THE WEEK
( Pat Goldstein offers real estate tip—about 1 minute)
David Corwin offers a tip –about 1 minute
Talk Shoppe offers free networking & education to anyone interested in real estate or in business or in health and wellness. Talk Shoppe meets every Wednesday 9A-10A CT at Concorde Career College 5100 Poplar Ave 1st floor Memphis, TN (Clark Tower). You can also join the even on zoom. Go to www.TalkShoppe.com and click the Events tab for the link to get into the event online. This Wednesday March 23rd, 2022 9A- 10A Central Mark Ruleman of Ruleman Asset Management and Planning will be presenting “Inflation Nation.” Here’s an except from what he will be sharing (play the recording of Mark Ruleman 1 min interview)
Talk Shoppe wants to thank sponsor Kim Halyak of Cooper Young Garden Walk for her financial support of our business community. Join Kim Halyak of Cooper Young Garden Walk at their 7th annual Cooper Young Garden Walk extravaganza May 21st -22nd 9A-4pm www.cooperyounggardenwalk.org
Talk Shoppe says thank you to Jo Rook, Director of Healing and Wellness Ministry at Church of the Harvest in Olive Branch for her financial support of our business community. Jo Rook will be leading the Healing Conference workshop April 8th-10th 2022 For more info go to www.JoRook.com
2. Salute to our University of Memphis basketball team during March Madness. Go Tigers!
4. Subscribe at www.JoGarner.com and you can get our weekly blog posts with podcasts conveniently in your inbox.
5. Real Estate Mortgage Shoppe reminds you to MAKE YOUR PLAN. LET’S WORK YOUR PLAN. IF THE DEAL WORKS FOR YOU TODAY, DO IT TODAY.
SPECIAL NOTE: REAL ESTATE MORTGAGE SHOPPE RECOMMENDS THAT YOU CONSULT WITH A FINANCIAL, LEGAL OR OTHER CERTIFIED, LICENSED PROFESSIONAL BEFORE ACTING OR INVESTING ON ANYTHING YOU HEAR OR SEE FROM THE CONTENT ON THIS SHOW OR BLOG POSTS. THE INFORMATION WE SHARE ON REAL ESTATE MORTGAGE SHOPPE IS GENERAL IN NATURE MEANT FOR GENERAL EDUCATIONAL PURPOSES ONLY. ALL EXAMPLES GIVEN FOR ILLUSTRATION PURPOSES ON REAL ESTATE MORTGAGE SHOPPE AND ARE BASED ON TRUE STORIES BUT WE USE FICTIONAL CHARACTERS AND DO NOT DIRECTLY REFLECT REAL PEOPLE OR EXACT DETAILS IN ANY OF THE SITUATIONS.
The quote of the week: “Those who have not seen a morning in the county, don’t know what a good morning is.” CutenCountry
Genell Holloway, Eagle Hollow Enterprise
Mary Lou Nowak, owner of Mid-South Home Helpers (901) 414-9696
Miranda Griffin, www.healthymidsouth.net
Transitional Music: “Small Town, USA” Justin Moore ; “Country Living ” by the Stylistics; “Where the Green Grass Grows” by Tim McGraw; “Taking Care of Business” by Bachman Turner Overdrive for the Talk Shoppe Business Tip for Real Estate Pros
PICK UP YOUR COPY OF “CHOOSING THE BEST MORTGAGE-THE QUICKEST WAY TO THE LIFE YOU WANT” by: JO GARNER
An essential guide for real estate professionals and their customers.
“Choosing the Best Mortgage-The Quickest Way to the Life You Want” is an essential guide for consumers and real estate professionals that will give them a good understanding of the loan products out there. They will have at a guide to the advantages the disadvantages of those loan products—when to use them and when not to use them.
The people stories give examples to help real estate professionals. Consumers that are looking now will benefit and I could easily see this book as a great resource for anybody in the future who want to buy real estate or restructure their finances using a mortgage.
Now on Amazon and Barnes and Noble
REALTOR WITH CRYE-LEIKE
PAT GOLDSTEIN, (901) 606-2000
2006 MAAR Realtor Associate of the Year 2005 MAAR Presidential Award Recipient TAR Leadership Graduate Member National Association of Realtors
Life Member of the Multi-Million Dollar Club. Toastmasters Division Governor CBS (Certified Builder Specialist)
CRA (Certified Relocation Associate)
CRS (Certified Residential Specialist)
GREEN (Green Agent)
GRI (Graduate, Realtors Institute)
MMDC (Crye-Leike Multi-Million Dollar Club)
SRES (Seniors Real Estate Specialist)
SRS (Seller Representative Specialist)
Vice-President (Circle of Excellence)
ABOUT DAVID CORWIN,
Deputy Director of Lender and Partner Activities, USDA Rural Development Single Family Guaranteed Program
David J. Corwin
Deputy Director of Lender and Partner Activities, USDA Rural Development Single Family Guaranteed Program
David Corwin was born and raised in Endicott, NY, and attended Lock Haven University of Pennsylvania, graduating in 1993 with a Bachelor’s degree in Economics and Finance. In the 16 years that followed, he garnered a variety of private sector experience, including financial and mortgage management, retail management, education, sales, and as a musician. His career with USDA Rural Development began in 2009 and includes experience with several agency programs taking place in Montana, New Jersey, and Pennsylvania. His current role with National Headquarters directs the efforts of marketing, training, and outreach for lenders and partners of the Single Family Housing Guaranteed Loan Program. David currently resides in Elizabethtown, PA with his son and two daughters.
ABOUT JO GARNER-MORTGAGE LOAN OFFICER:
WHAT DO YOU WANT TO ACCOMPLISH WITH YOUR MORTGAGE?
“Whatever YOUR personal priorities are, my job is to help you get the mortgage terms that will give you bragging rights when you talk about it and help you score on hitting your goals .”
As a mortgage loan officer, my job is to help you get to the benefits you want from your financing terms. What is most important to you? I can help you find the financing terms that will help you get to what you want. What is your comfort level on a house payment? How much are you comfortable paying down,? What type of financing do you need to get the house you want to buy or refinance?
Different clients have different priorities in life—some are buying their first home with very little down payment funds. Some are recovering from medical challenges, divorces or preparing to send children to college and some are embarking on a long term goal of buying properties to build rental income.”
Jo Garner is a mortgage officer with extensive knowledge in tailoring mortgages to her customers who are refinancing or purchasing homes all over the country. She offers conventional, FHA, VA or other loan programs for refinancing and purchases.
Jo can help you look at rent vs buy, when it makes sense to refinance, how to get the best deal on your home purchase financing.
Jo Garner has been in the real estate/financing business for over 25 years. She got her start in Portland, Maine where she first began her real estate career. She received her real estate education from the University of Southern Maine and was personally mentored in San Diego, California by Robert G. Allen, author of Nothing Down, Creating Wealth and The Challenge.
On moving back to West Tennessee in 1987, she went into business buying and selling discounted owner-financed notes secured on real estate. In 1990 Jo went to work for a residential mortgage company and has been a mortgage loan officer for over 25 years. Her goal is to offer excellent, affordable service to her customers, tailoring the loan programs to the specific needs of her clients.
In addition to her work in the mortgage field, Jo Garner is the primary sponsor and founder of Talk Shoppe in Memphis. www.TalkShoppe.com Jo Garner also host the radio show Real Estate Mortgage Shoppe airing on News Radio AM 600 WREC and iHeart Radio with podcasts and show notes published on www.JoGarner.com Get the book by Jo Garner Choosing the Best Mortgage-The Quickest Way to the Life You Want at Amazon and Barnes and Noble.