USDA Loans California
Many people may have heard of the FHA and VA loan program but are not aware of a third “government loan program” that is available to California home buyers. With a USDA Loan, buyers can purchase a home with no money down.
The USDA home loan program is a great program for people looking to buy a home in California with little to no money down.
USDA loans were created to help potential low- to moderate-income homeowners in rural areas. This includes the many areas on the outskirts of some of California’s larger cities where many affordable homes are located. They are a popular loan option with recent college graduates, newly formed households, low-to-moderate income earners, first time home buyers, and those who have had past credit challenges.
California USDA Loan Closing Cost Assistance
California USDA Loans are almost always offered with 100% financing. Although this does not necessarily mean that buyers won’t bring cash to close. There are closing costs associated with the loan as well as prepaid items like interest, taxes and insurance. The good news is that California USDA down payment assistance programs offer sufficient grant money to cover the majority of these costs so buyers can buy a home with as little out of pocket as possible.
The following are California USDA Loan Highlights:
- No down payment requirement
- Competitive interest rates
- Can be combined with California down payment grants to cover closing costs
- No first time homebuyer restrictions
- Flexible underwriting guidelines make it easier to qualify than other California loan programs
- No minimum cash contribution requirement
- 100% gifting and seller concession is allowed
Who Can Buy a Home in California with a USDA Loan?
California buyers who plans to occupy a home in an eligible rural area in California as their primary residence may qualify for a USDA loan. Eligibility is strictly based on location. USDA offers visibility of properties eligible for USDA financing here.
Waiting Periods – USDA Loans California
Below are the standard USDA waiting periods for major derogatory credit events:
- California USDA home loan after bankruptcy: The waiting period for getting an USDA loan after a chapter 7 bankruptcy is 3 years. The waiting period for getting an USDA loan after a chapter 13 bankruptcy is 1 year.
- California USDA home loan after foreclosure: The waiting period for getting an USDA loan after a foreclosure is 3 years after the foreclosure.
- California USDA home loan after short sale: The waiting period for getting an USDA loan after a short sale is typically 3 years.
FHA | VA | CONVENTIONAL
