USDA Loans

J.G. Wentworth and the United States Department of Agriculture have spent years assisting rural homebuyers in financing their homes. As a direct lender providing Americans with a variety of home loan options, J.G. Wentworth is proud to offer Rural Development Guaranteed Housing loans from the USDA. By offering low interest rates, a streamlined application process, timely loan turnarounds, and an unbeatable commitment to customer satisfaction, we set ourselves apart as a nationally-leading provider of USDA loans. 

What is a USDA Loan?

Loans backed by the United States Department of Agriculture are often referred to as USDA Loans. These federally-insured mortgage loans are designed to offer significant benefits to rural, low-income homebuyers in eligible areas of the country. While rural areas are typically considered to be areas with low population density, USDA loan eligibility can extend to suburban areas positioned outside of larger American cities.

USDA Rural Development Guaranteed Housing Loans (RD Loans)

USDA RD Loans are mortgages that offer up to 100% financing for low-income Americans living in rural areas. Qualified homebuyers can use these loans for financing a home mortgage without making a down payment, making USDA loans an attractive option to those who wish to avoid a large initial payment without drastically increasing their interest rate. The fact that USDA loans from J.G. Wentworth are federally-insured assists low-income homebuyers in qualifying for a mortgage when they might have been denied financing on a conventional loan.

Advantages of USDA Guarantee Loans

USDA loans have relaxed requirements compared to other types of loans, making them a highly beneficial option for homebuyers with limited income or less-than-perfect credit. Many of the prominent advantages of USDA Guarantee loans include:

100% Financing

USDA loans provide homebuyers with 100% financing options, allowing for a unique opportunity to finance a home without requiring any out-of-pocket costs.

No Down Payment Requirement

Potentially the best reason to consider a USDA loan is the fact that there is no down payment required, allowing low-to-moderate income homebuyers to put zero down while still receiving 100% financing on a mortgage. USDA loans are the only type of mortgage that can facilitate this aside from VA loans, which non-veterans cannot qualify for. 

Low Mortgage Insurance Premiums

In the case of conventional loans, if a homebuyer cannot make a down payment of at least 20%, they will need to pay extra money towards mortgage insurance. USDA loans require no down payment, but still have one of the lowest MIP percentages available to homebuyers, requiring just a small 0.3% annual mortgage insurance payment. 

Low Mortgage Rates

With many types of loans, if you do not make a high enough down payment, your interest rate will be higher. This is not the case with USDA loans, as interest rates are typically very close in comparison to the interest rate you may receive on a conventional mortgage loan. By keeping mortgage rates low, the USDA and J.G. Wentworth help to drive down monthly mortgage payments, ultimately putting more money back in your pocket.

Multiple Rate-and-Term Options

USDA loans are available with a 30-year fixed-rate option, allowing homebuyers to benefit from a lower monthly payment over a longer 30-year term. As of 2014, the USDA extended their guidelines to include 15-year fixed rate terms for those who wish to pay off their mortgage more quickly. In both cases, J.G. Wentworth can provide low rates that, when paired with no down payment, keep mortgage costs and USDA loan payments affordable for homebuyers with low-to-moderate income.

Eligibility Area

While USDA loans are catered toward rural homebuyers, the term “rural” is used loosely. Roughly 97% of the United States falls within the USDA eligibility zone, allowing Americans in both rural and suburban areas to qualify when they meet the credit and income requirements for USDA loans. 

Large Variety of Eligible Properties

Although certain types of mortgage loans will limit financing to primary or secondary homes, loans from the United States Department of Agriculture provide options for a variety of property types, including:

  • Single Family Homes
  • New Construction Homes
  • Townhomes
  • HUD-Approved Condos
  • FHA-Approved Modular Homes

USDA Loan Approval

While USDA loans are designed specifically for rural homebuyers with low-to-moderate income, there are still some baseline requirements for approval:

  • Property must be a primary residence
    • While there are multiple options in terms of what type of property you are financing, the underlying requirement is that it is your primary residence.
    • USDA loans are not applicable to farms
  • Must be in an eligible USDA location
    • Approximately 97% of the United States falls under this category, so chances are usually very good that your home will be in an eligible area unless you live in a dense metropolitan area.
  • USDA checks for an adequate credit score
    • Typically, a credit score of 620 or higher is needed for approval, but in some instances you may be approved even with a lower score. 
  • Gross household income cannot exceed 115% of your area’s median income
  • Proof of stable income history for at least two years

Get a Free Quote

If you are seeking a home mortgage loan, but are concerned about being able to afford the down payment typically required with conventional loans, call J.G. Wentworth to see if you qualify for a USDA Guarantee loan. Our knowledgeable loan specialists will help you compare your loan options in an effort to find the best fit for you. By providing a streamlined process and expedited loan turnarounds, J.G. Wentworth aims to make finding a home mortgage as easy and efficient as possible. To get a free, no-obligation quote, contact us by calling or filling out our simple contact form. For any additional questions on USDA loans, conventional home loans, or refinancing, check out our mortgage FAQs.

How do I get started?

J.G. Wentworth offers a wide variety of loan programs with low rates and no points and no hidden fees.  To get started, you can call us or let us contact you by completing a short form.  You can also get a rate quote in seconds with no personal information required. We look forward to working with you.