Richard's Real Estate Thoughts - Chattanooga TN Mortgage Lender

Changes in the USDA Rural Development Home Loan


The USDA Rural Development program has several new features, effective 12/1/2014. Most of the changes are good news for home buyers and sellers.  The USDA Rural Development program has always had many features that make is an excellent home purchase loan alternative for many buyers. 

These features include: 

  • No minimum down payment, 100% LTV financing

  • Low monthly fees (compare to conventional mortgage insurance)

  • Low loan interest rates 

The program is designed for moderate income families and has restrictions about locations approved for USDA financing.  Another occasional problem was delays in closing that resulted from the approval review requirement. Lenders prior to closing had to obtain funding authorization from the local USDA office. This requirement could add a week to 3 weeks to the closing time frame. 

One of the new features of the USDA changes promises to streamline this closing process. We are early into the implementation of the changes, and much is still to be discovered about the program improvements. 

I hope that most of these new features make a great home purchase program even better for buyers seeking to purchase in approved USDA areas. 

You can determine if  your home is in an approved USDA area by accessing the USDA website here. 

Call me with your questions about the USDA home purchase program in general or about the many changes that became effected 12/1/2014. 

I will more comments on some of these changes in future posts.


Thank you for visiting. This is the professional blog for

Richard Smith
NMLS# 184479 TN# 104002 Georgia Residential Mortgage Licensee, GA#28928 

Conventional, FHA, FHA 203k, HUD $100 down purchases, VA,

Rural Development (USDA), THDA and Jumbo Loans

Lending in Chattanooga, Tennessee and Georgia for over 20 years.

Fairway Independent Morgage Company

Cell phone: 423-280-0345 Email:

Visit my website to inquiry about a home loan.

This blog represents the opinions of Richard Smith. The posts and comments written on the blog do not represent the opinions or positions of Fairway Independent Mortgage Corporation.

Comment balloon 1 commentRichard Smith • December 05 2014 02:36PM
Changes in the USDA Rural Development Home Loan
The USDA Rural Development program has several new features, effective 12/1/2014. Most of the changes are good news for home buyers and sellers. The USDA Rural Development program has always had many features that make is an excellent home… more
New Construction Home Financing with FHA Loans
Build your new home with FHA Construction permanent financing This program combines the benefits of FHA lending with the advantages of a one time close construction financing The one time close means there is no requalification after… more
Get Ready to Purchase. First Step - Prequalification
For all home buyers, the first step needs to be pre qualification. And for too many home buyers they try to take the second step first. Looking for a home before obtaining a loan preapproval can cause make your home purchase a more difficult… more
Small repair holding up your home purchase? Repair escrow might help.
Some purchases can be held up by a fairly minor expensive repair. The buyer is OK with purchasing the home with the repair not completed, but the lender requires that the repair be done prior to closing the purchase. The seller might be a… more
Gift Funds for Closing
For many buyers the biggest hurdle to purchasing a home is the down payment. USDA financing offers a great option for financing with no downpaymet for homes in qualified areas. For veterans, VA financing is generally a great financing option. … more
Buying a foreclosure home
Foreclosured homes have become a major segment of the home sales market. For many home buyers, purchasing a foreclosure property means buying a Great Deal. As with any home, buyers should be informed about the price, the neighborhood, and the… more
FHA Mortgage Insurance Gets More Expensive
The recent changes to FHA mortgage insurance have continued the recent trends of increasing costs for home buyers using FHA financings. Over the last few years monthly FHA mortgage insurance has been raised an annual premium of 55% to this new 1. 35… more
First time buyers get ready to buy your home in 2013
Buying a first home remains the goal for most people and families. It has become more difficult for some over recent years, but for those who can qualify, it has never been more affordable. Rates continue to be low Home prices… more
What documents are needed for my home loan approval?
Home buyers may have the perception that mortgage lenders have increased their documentation requirements. That perception has been encouraged by some sloppy media reporting but for most buyers mortgage lenders have not increased documentation… more
Which home loan type is right for me?
One of the first questions that many home buyers, especially first time home buyers, often ask is "What type of home loan is right for me? ". There are many options (Conventional, FHA, VA, USDA, Jumbo, Homepath, 203k, 1st and 2nd… more