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Old 01-04-2010, 03:11 AM
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I am planning to buy a home in the Little Elm, TX area. (zip code 75068) I would like to take advantage of the USDA loan option, which allows for loans WITHOUT the PMI of a FHA Loan, if you purchase a home they consider a rural area.

The problem is that Little Elm has been increasing in population like crazy in the past couple years and my Realtor told me that the state plans to reevaluate the Little Elm area in early 2010. According to her, they were supposed to do this 6 months ago.

If this is true, I am afraid Little Elm will no longer be considered a "rural area" according to the USDA standards and negate the USDA loan option, which means I have to pay PMI and go the FHA loan route. PMI would add about $70-$80 extra a month.

Does anybody know how this reevaluating process works with the USDA and their scheduling for the Little Elm area?

Any additional advice?

I appreciate any feedback.

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Old 01-04-2010, 08:00 AM
Location: Central Texas
20,963 posts, read 43,009,424 times
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It's my understanding from the mortgage lenders I work with that the USDA loans are based on the category the specific piece of property at the time of the most recent Census; however, some entire towns qualify, perhaps because they are rural based. In that case, 2010 would be when it would happen. This also means that a house that qualifies can be next door to a house that doesn't (Sun City, Georgetown, comes to mind, where houses built before 2000 would not qualify but houses built in the areas that were still pasture in 2000 would - after the 2010 census, houses built in Sun City before 2000 won't be eligible, but those built on land that was cow pasture at that time will). I never assume about a property that might be eligible is or is not, but check the specific address on the USDA website.
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