Low income home loans

[MoNative34]

Originally Posted by christina0001

I can't argue the program because we have a mortgage that was through the USDA. We are not low income, and my credit is outstanding. But, my partner's credit is not great. We compared loans at three banks, and the USDA loan was overall the best match for us. I have no idea why the Dept. of Ag. offers this program, but I'm grateful for it. I love our home. We would not have bought with any of the other loans that we were offered; the terms were terrible (IMO) because of his credit.
We did not get anything like a 1% - 2% interest rate; it is 5.25% actually. There was no down payment required, which was nice, but we did put down 10%.
I have my student loans through the government as well; I actually appreciate the fact that the interest I pay each month is going to the government instead of some giant corporation.

The major factor is that you have the income to own a home.

The $16,700 a year income mentioned by the OP and trying to own a home no matter what the interest rate is is a disaster waiting to happen.

Who picks up the tab when that disaster happens??

[Versatile]

They way i read it is that in this case the payment will be subsidized. Why not read up on it and give us your spin on it. Can be good can be bad imo

[MoNative34]

Originally Posted by Versatile

They way i read it is that in this case the payment will be subsidized.

That's what I thought....


http://i297.photobucket.com/albums/mm239/spectral_music/Honk.jpg (broken link)

[poetrydiva]

Originally Posted by 20yrsinBranson

I agree. Most "low income" people I know are woefully poor at managing money. They move every couple of months because they cannot make their rent payment. (This does not stop them, however, from drinking beer and smoking cigarettes and eating out DAILY at McDonalds rather than packing a lunch). Often they will default on their car payment and their car is repossessed until such time as they can find another one at the "pay weekly" car lot. However, they almost always manage to buy $500 worth of Xmas present for their kids and blow their $5,000 tax refund in a matter of weeks on junk and garbage.

What I am getting to here is that they WILL lose the house that the Department of Agriculture is helping them buy. It is a waste of tax payers money. They should REQUIRE any potential home owner to take a financial management class and then monitor their finances prior to, and after the house purchase.

But of course, they won't.

Just another black hole of tax payer's money. *sigh*

Disclaimer: Not all poor people throw their money away . I'm sure there are some that are *very* financially responsible and do not fit my sweeping generalization based upon my own personal experience.

We are one of those low income families who don't fall into your sweeping generalizations . My husband is permanently disabled from birth and I just finished college and am trying to find a job. We drive a 19 year old car because it is cheaper per month even with the periodic repairs and lower insurance than it would be per month with a newer car. Our Credit Scores are between 743 and 750. We have almost $40,000 in established credit, no cards maxed out, and only one with a rolling balance that is taking advantage of a 0% APR offer. We have the money sitting in savings accruing interest and will pay it off in full when the offer expires. We also have a student loan of mine that is in deferment until late next year, and that loan has a balance of less than $5,000 to pay off at a payment of $53 a month, but we'll be paying above that to bring the balance down quickly.

We are applying for a USDA Direct Loan because we can't get conventional financing because I haven't been able to find a job yet. With USDA, my husband's disability each month will be able to cover the monthly mortgage payment for less than what we're paying in rent right now. Also, we live in Texas so there's no state property tax and we only pay tax on the portion of land that has been improved. For the area where we are building, that tax rate is less than 2% annually, but we won't have to pay that because of my husband's disability. Also, homeowner's insurance will be combined with our car insurance for a lower rate and will be paid twice a year.

So, you can be low income, but if you are fiscally responsible, you can have a home and not a crappy old apartment that's falling apart and not have to wait Lord knows how long for school districts to start hiring again instead of laying off.

[amazonmoma]

Originally Posted by Versatile

The satisfaction of knowing that i helped out someone that otherwise would not have known. Sure it is a result of the burst bubble. No reason not to get yourself a loan if you qualify and need housing.
Check it out.A lot more people qualify than they might think. NO down payment! Some can qualify for payment assistance. I think that any small town under 25000 people qualifies as well. Top purchase price is $140,000.00. Even a person making $16,700.00 qualifies and that will be 1% at 30 yrs. A $26,000.00 per year income nets a 2-3% loan.

USDA Website--http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?NavKey=home@1

Crugy! Have you seen me profit off any other good deals i have posted?

I have known several people to apply for the USDA loans and I am looking into one right now. NONE of us have been able to do this without a down payment of at LEAST 5%. The size of the town only qualifies if you have USDA working in your area. Most people that get close to the $40K/year point are no longer eligible for a loan. Plus you still must have decent credit. If your credit score is below 600 you probably aren't going to get much of a loan through them. This is just what I have learned working with the USDA loan officer here.

[Versatile]

Originally Posted by amazonmoma

I have known several people to apply for the USDA loans and I am looking into one right now. NONE of us have been able to do this without a down payment of at LEAST 5%. The size of the town only qualifies if you have USDA working in your area. Most people that get close to the $40K/year point are no longer eligible for a loan. Plus you still must have decent credit. If your credit score is below 600 you probably aren't going to get much of a loan through them. This is just what I have learned working with the USDA loan officer here.

Thanks for the info. People need the real facts. I posted what i read and was told.