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We put a contract on a home that wasn't built yet back in October. It's almost finished and our closing date went from the 20th to the 8th of April. We went usda as our loan officer said its a better loan and we preferred the usda loan terms etc. come march 27th usda is taking our homes area off the eliagable map. We have been told there isn't any information if our home will be grandfathered in because we have been through underwriting and are at usdas office. Should our agent start showing us homes that are eliagable to ones that won't be a costly. We have the funds for an FHA option but with the pmi our payment would be more then we would like as taxes on the home are crazy.
As long as you are approved and get the USDA approval prior to the end of March, your closing needs to take place within 60 days. You should be fine as long as you have your approval. And if the city this house is in is removed from the USDA list, that means you would have to go to a completely different city further out. It's happening all over. In my area, basically no areas will be covered after March.
You may have just dodged a bullet. USDA loans have a lot of the same 'issues' that came with subprime loans in far flung suburbs did during the bubble. You're probably better off not buying anything that is eligible for those loans and avoiding neighborhoods with them entirely.
We were approved with our lender, got some conditions, met them and then she sent it to usda and we haven't heard what USDA said. My guess is they are stilling looking it over. We did our rate lock as well. So as far as I know it's looked good but as far as USDA approving before the 27th in worried because I think our lender sent in our packet a little late as usda tends to take longer (from what I've heard and researched). Yeah we would have to go about 25 minutes out to a smaller but nice town but perfer not to. We can stay in the area and do FHA we just would have to get a house that would be a bit cheaper and taxes not so high. This is all really crappy! Thanks for your reply.
What's in your sales contract for the house? Did you put in a mortgage contingency stating that you were using a USDA loan for a mortgage? .
If you did, you can probably walk away if you don't get the mortgage approval. If the wording is not there for a mortgage contingency, then you may be locked into buying that house using another mortgage type.
Go to the builder and tell him that you lose your mortgage on the 27th of March and that if he wants you to buy that house, he'd better get to crackin' and get it done.
Builders can build a house in 30 days, start to finish, if they are motivated. (once permits are issued, which can take a long time). You builder can get that house finished in that time frame if he puts some effort into it.
We have gone to the builder, they said end of march at the earliest. We started this process in October so were pretty upset we might lose it because of the loan but the payment difference between a usda and FHA is quite a difference. From y findings this change was available last year and so I ask why did our lender send our stuff off to usda so late? I don't think we have to get the property regardless of what loan we use. I just wonder when do we start to look at the finances and other properties wether it be usda or FHA property and maybe use a new lender...
And you would go out 25 additional minutes to save a little on your mortgage? That's 50 minutes back and forth any time you need to go somewhere? How much additional gas are you spending? How much additional will you spend on maintenance to your car? How much less time will you spend with your family. If the additional mortgage insurance is that much more for you, you aren't looking at the grand picture of how much more you're going to spend going out another 25 minutes. 2-5 minutes further out is one thing, but you said 25 minutes further out. Doesn't make sense...
And you would go out 25 additional minutes to save a little on your mortgage? That's 50 minutes back and forth any time you need to go somewhere? How much additional gas are you spending? How much additional will you spend on maintenance to your car? How much less time will you spend with your family. If the additional mortgage insurance is that much more for you, you aren't looking at the grand picture of how much more you're going to spend going out another 25 minutes. 2-5 minutes further out is one thing, but you said 25 minutes further out. Doesn't make sense...
I've looked at some of the USDA approved developments in my area and they seem doomed to select exactly the kinds of buyers that should not be stretching into a home loan. The remote locations make them largely undesirable. People only seem interested in buying there because they're cheap, and don't require much money down. Well, what's going to happen once many of these people decide an extra hour+ of commuting sucks? They'll leave - and probably not because they've found a buyer willing to pay what they owe on a now used house.
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