What kind of house can I buy with a USDA loan?

What kind of house can I buy with USDA? In this video I go over the types of houses that you can and cannot buy with a USDA mortgage loan.

Today in this video we’re going to talk about what kind of house can you buy with a usda rural housing loan check it out hi i’m rhonda burgess and i’m a real estate broker and mortgage underwriter here in the nashville tennessee area and my firm is southern living realty partners okay let’s get into it first of all we’re going to talk about what kind of house

Can you buy on a usda loan first of all let’s do a little history lesson y’all need to know a little history of the usda program back in the day we used to call it the farmer’s home loan that’s what it was called especially when it was still under hood it was the farmer’s home loan then it became the usda rural housing loan the the program is designed to promote

Home ownership in the rural communities and they’re looking for people with a low to moderate incomes so first of all let’s talk about high income people who could normally do a conventional loan let’s say you have the 20 down you have money for your reserves um you know after closing all this good stuff if you qualify for a conventional loan you cannot buy you

Cannot use a usda loan to buy a house this is strictly for people who would not normally um qualify for traditional conventional financing okay this loan is not for investors this is for home owners let me say that again this loan is for home owners now i know people say well you know i’m gonna say i’m gonna live in the house whatever that’s between you and you

And your god whatever you do okay all i’m telling you is the loan is designed just for people who are going to be homeowners families who are going to live in these houses there will be several times where you will attest and affirm that you will be living in the house and that it will be owner occupied there’s an affidavit that you have to sign and it is notarized

At closing stating that you will occupy that house like i said i have all kinds of investors calling me well you know i can say i’m a living i’m gonna do this i’m gonna do it that’s between you and whatever you want to do but all i’m telling you is a guideline say it’s for homeowners it is not for investors okay you it has to be adequate and suitable housing for

The number of occupants also okay this is something you need to keep in mind so if it is a three-bedroom home and you have five six kids it’s not gonna work because you have to you’re supposed to have adequate number of bedrooms for the number of people now you could probably get away with it you know i see it come through all the time but i’m just telling you

See also  What Does The Bible Say About Alcohol?

What the guidelines say is you know you’re supposed to have enough bedrooms in here for the number of occupants okay um i know it’s a minimum i think a 600 square feet i think it is 600 or 700 square feet so you cannot do a tiny house let me say this again usda will not guarantee a loan do a loan for a tiny house that is a very specific type of property outside

Of the usda i don’t know of any lender in particular that will lend on a tiny house because see that’s very particular because if the person buys the house and lives and how this says they want to sell it or they don’t want it anymore or whatever you got to find somebody who specifically specifically wants a tiny house and usda don’t do that like i said i think

It’s a 600 square foot minimum i do believe it is but don’t even try it with the tiny house we won’t do it we won’t do it keeping on with the things that usda will the types of houses that usda will not lend on container homes i know y’all seeing all the rage about these uh shipping containers they put them together you know they build them and you know one or

Two stores or whatever they’re doing it with the shipping containers usda will not do it this is what you call a unique property container homes tiny homes they’re all unique properties you will have a hard time finding any lender to do a unique property because as i told y’all before remember lending is all about liability it’s all about liability so you have

To think if they have if the bank has to foreclose on you and now let me tell you they don’t want your house the banks do not want your house so if you fall behind on your mortgage call your bank call your lender call them and tell them what’s going on believe me they don’t want your house they do not want your house it’s it’s a bigger they lose so much money if

They have to take your house back okay so then when it comes down to whether or not they want to lend to you they’re going to look at the property because if it’s a unique property they’re not going to do it and you’re going to have a hard time trying to find somebody to do it you know berm houses where it’s built like into the side of a mountain and like you may

See also  President Ruto explains the governments plan on climate change during Mashujaa Day Celebrations

Not handle windows on the back because it’s really partially underground you don’t have problems those yurts i think i’m saying that right those round houses you know they round they got no square walls it’s just a big old you’re gonna have problems that’s a unique property and i’m not saying it’s a problem for usda it’s not only a problem for usda it’s a problem

For 99 of your lenders out here you’re gonna have to find a specialty lender who does that and when you get into unique properties with a specialty lender it’s going to require a higher down payment it’s going to require some type of down payment because they need a buffer they need some type of assurance that you are truly truly going to pay for this house or they

Need to they need for you to go into the property with some equity just in case they have to foreclose on you so they can try to get some of their money back continuing on what kind of house can you buy with a usda loan you can buy a manufactured home but not an old manufactured home okay you can do a single wire you can be adult you can do a double wide you can

Do a triple wide you know i watch these videos too i told you i watch a lot of youtube man they doing some wonderful stuff in these manufactured homes these days i mean this stuff is nice nice just know this you can do a single wide a double wide triple wide but it’s got to be built 2006 forward don’t don’t run up don’t look don’t call your lender tell my two found

This this trailer and you know it’s leaning you know it’s leaning built in 1988 and you want somebody to give you a loan on that not gonna do it not gonna do it i’m just telling you usda does not issue guarantees on houses that old on manufactured homes that hold ninety percent of the loans i think i’ve ever seen done with usda they were all like a single family

Stick built home let’s talk about something i know we run into here in the south y’all some of y’all may not understand this barn dominiums we write they that’s a unique property that’s a unique property you’re gonna have a problem with that now you may can get some lenders to take it because it is more like a single family stick built house you know except it’s

Got that barn thing going on it’s just a different type of way we describe it as long as it’s livable square footage inside there you know in case you can’t have the horses on one side and you got a bed on the other side this this ain’t gonna work okay but as long as it is still a single family home built like a stick built home you can do a barndominium and you can

See also  Experts warn of cryptocurrency crash ahead of interest rate hike

Do a manufactured home okay but we don’t they don’t do they don’t do freaky weird stuff let me say that um another type of house that we do not do that i have seen like here in east tennessee you get up there in the mountains and i’ve seen it in the coastal uh areas because we went from just underwriting just tennessee loans to nationwide so i’ve seen properties

All over the country okay if your house if the house you’re looking at is on stilts okay you know like maybe you down towards uh new orleans way florida alabama you’re in the coastal areas and your houses they put it up on stilts because of the water you know because of the sea water and everything won’t do it i’m sorry even if you’re in a rural area but if that

House is on stilts they won’t do it so what i’m trying to tell you is when you’re looking at what type of house can you buy with a usda loan you doing just cookie cutter really single family homes yet if there is a duplex in a rural area per the guidelines uh i do believe that you can get that done i’ve never seen it i’m just telling you it’s a it’s a lot of stuff

In the guidelines that doesn’t exist and so um if you find a duplex i do believe and you’re gonna occupy it on one side you know i do believe you can get that done but one thing you have to remember you’re talking about properties that qualify for rural housing normally you don’t find multi-family properties out there in a rural area you just don’t okay so i

Do believe you can do it on a duplex again i’ve never seen it done but that’s that’s one of one of the types of houses that you can do you can do a manufacturer no stilts again my name is rhonda burgess and i’m a real estate broker and mortgage underwriter here in the nashville tennessee area if you need help with buying or selling a home here in nashville i’d be

Glad to help you my number you can reach me at any time at 615-554-0832 thank you and as always have a blessed day

Transcribed from video
What kind of house can I buy with a USDA loan? By Rhonda Burgess