Joe 's Blog


USDA Rural Housing – kick butt 100% financing that you’ll probably qualify for!

So you’re looking to buy a home, you don’t have a lot of cash to work with & want a low payment.  Looks like you better go to Craigslist & see the rental section right?

Not so fast young grasshopper (who doesn’t love David Carradine).  Enter USDA Rural Housing..…

Q: What is USDA Rural Housing?
  USDA Rural Housing Loans also called a Rural Development Loan, is a government insured home loan offering 100% financing to qualified buyers, allows for all closing costs to be paid for by the seller or financed into the loan (& the crowd goes wild!!). They offer some of the lowest rates of any loan at a fixed interest rate.


USDA Rural HousingQ: What are the requirements for USDA Rural Housing?
3 parts to this answer.

1.  Credit Worthiness: Your thinking, “Ok, I knew there’s a catch!”  Relax Danielson.  When your credit is reviewed for a USDA Loan the underwriter will be looking for a history of paying your bills on time.  Slow pays & credit blemishes may be overlooked if you have established your credit over the past 12 months.  A good credit explanation letter goes a long way.  If you say “I didn’t pay because I really needed that new Trans Am to pick up a hot chick” well that’s not going to win you any brownie points.  “I didn’t pay because I lost my job/got the bubonic plague/had 8 kids like octomom HOWEVER now I’m back to work & everything is hunky dory! Just check X references!” That will generally go much further….unless you still have bubonic plague.  If you have open judgments or collections the UW will most likely ask that they be paid in full before you close.

2.   Income: You will need to be able to document your income on a USDA Rural Housing Loan. USDA will generally want to see a two year history of employment or consistent income. “I’m a pizza guy, waiter, Columbian drug lord & can’t verify/get paid under the table” isn’t going to fly.  There are exceptions on the two year requirement can be made for applicants such as students. On a USDA Loan Assets are not required for approval, but can help overcome any possible blemishes on credit.  Keep in mind you MUST be within the maximum income limits.  Click HERE for the USDA Rural Housing Income Eligibility.

3.   Where you live: In order to qualify for a USDA Rural Housing Loan your home must be in designated USDA rural area. You can check the USDA eligibility of your county. It might will surprise you how many areas qualify! Scroll to the bottom to see some of the areas.  I think you’ll be pleasantly surprised!

Q: Is the USDA loan program limited to first-time buyers?
No, the USDA Rural Housing Program can be used by first-time buyers and repeat buyers.

Q: What mortgage products are available with a USDA mortgage?
The USDA / Rural Housing Program offers 30-year fixed rate mortgages only. There is no 15-year fixed rate mortgage. There are no adjustable-rate mortgages. 30-year fixed only.

Q: I can't afford closing costs. Can I get a gift for my closing costs?

A: Yes, USDA loans allow gifts from family members and non-family members. You will need a gift letter to accompany your loan application. Your loan officer (that would be me) can give you one.

Q: Can I use the USDA loan program for an investment property or vacation home?
No sir, the USDA Rural Housing Program is for primary residences only.

Q: Is there a minimum credit score for the USDA loan program?
There is no minimum score, per se, but 640 is generally regarded as a cutoff point. If your FICO is below 640, you should be prepared to explain why your credit score is below 640, and provide documentation. If you are without a credit score, your lender may accept "alternate" tradelines to establish credit history.

This list is NOT meant to be a comprehensive overview of what the USDA allows, but it covers a lot of good ground.

If you want more information, talk to your lender (that would be me J) or reach out to me directly. USDA mortgage rates are low and my office underwrites and funds our USDA loans in-house.

Now here’s the great news for all of my SEI Investments, Vanguard, De Lage Landen, Pfizer clients in & around Montgomery County.  The following cities qualify:


Collegeville, Royersford, Evansburg, Trappe, Limerick, Schwenksville, Skippack, Oaks, Kimberton, Chester Springs, West Pikeland, Mont Clare, Birchrunville, Spring City ALL QUALIFY!!!  (Generous applause please!!!)

So now that I have your attention, what’s the next step?  Give me a call shoot me an email with questions! It’s that simple. 


For help or questions contact:

Joe Gonzalez

Senior Loan Consultant -  NMLS #126036
GMH Mortgage Services, LLC
625 W. Ridge Pike, Building C, Suite 100 | Conshohocken, PA  19428 | Direct: 610-355-8039 |  Cell: 610-739-6563

FHA Jumbo Loan, Mortgage King Of Prussia   FHA Jumbo Loan, Mortgage King Of Prussia   FHA Jumbo Loan, Mortgage King Of Prussia

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Comment balloon 21 commentsJoe Gonzalez • October 21 2011 03:56PM



Geat post on a loan program that gets overlooked all to often.

Posted by Nicole Needham, SFR (530) 302-5478 (Needham Realty) over 8 years ago

I'd also like to add that this loan program is the only one I know of that does not have a specific timeline barring a recent short seller to buy again. I just got a former short seller into a new home 7 months after his short with this loan.

Posted by Minna Reid, Associate Broker (Killebrew & Company Realty, Inc.) over 8 years ago

@Nicole - thanks. It really does get overlooked.

@Minna - nice catch there.  I'll have to keep that in mind.

Posted by Joe Gonzalez, NMLS# 126036 (610) 739-6563 (CrossCountry Mortgage, LLC NMLS #3029) over 8 years ago

Awesome program with minor restrictions (i.e acreage, income)...thanks again for the eligibilty link.  It is amazing at some of the geographic locations allowed. 

Posted by Richmond Virginia over 8 years ago

Joe ... I love this program ... we use it a lot here in Northern Nevada! It's one of the best!

Posted by Lisa Wetzel, CDPE, SFR (RE/MAX Realty Affiliates) over 8 years ago

Great post.  Sometimes we don't use it enough to be able to present it in the most informative and effective way.

Posted by Gary Balentine (Crye-Leike Realtors) over 8 years ago

Joe, rural development is the primary mortgage loan being used here in west Tennessee. Congrats on the feature!

Posted by Mike Frazier, Northwest Tennessee Realtor (Carousel Realty of Dyer County) over 8 years ago

@Tim - your welcome.  Glad to help
@Erica - yes they are. Pottsville huh? I'm not to far from you here in King of Prussia.  We'll have to connect some time.
@ Lisa - I'm surprised how many areas this program is available to.  It's good stuff.
@ Gary - thanks. I think that if we collectively as real estate professionals educate our clients, we'll have a few more closings!!
@Mike - That's interesting.  West Tennessee.  Why is it the primary loan being used?  I mean that's great but I haven't heard of that any where.  Thanks a ton for the input & please provide feedback.  And thanks, it's my first feature & I have to say, I'm kind of enjoying this blogging thing.  :-)

Posted by Joe Gonzalez, NMLS# 126036 (610) 739-6563 (CrossCountry Mortgage, LLC NMLS #3029) over 8 years ago

USDA loans are a great option for buyers.  I just was informed that the funding had returned.  This is great news.

Posted by Joan Whitebook, Consumer Focused Real Estate Services (BHG The Masiello Group) over 8 years ago

Great news & what a fun post!  Thank you....sending this right over to my daughter who is wanting to start an small farm of their own, but felt too over whelmed & did't think she I can call her a little "grasshopper"....

Posted by Pam Hills, ASP/IAHSP- Stager Miami, FL, Creative Minds Innovatively At Work (Innovative Artistry) over 8 years ago

WE do tons of RD loans up here n north Idaho.  They are fabulous for those who qualify, the best loan program there is!

Posted by Janna Scharf, Coeur d'Alene Idaho Real Estate Expert (Keller Williams Realty Coeur d'Alene) over 8 years ago

This is a good program and many buyers are not aware of it. Thanks for the post.

Posted by Gita Bantwal, REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel (RE/MAX Centre Realtors) over 8 years ago
Good review of the loan. Thanks for posting this! Great for agents and consumers!
Posted by Cheryl Ritchie, Southern Maryland 301-980-7566 (RE/MAX Leading Edge over 8 years ago

Joe USDA loans have been a great addition for me to get my listings sold. I love how you present it in your blog, it makes it fun to read and easy to follow. have a good weekend.

Posted by Scott Godzyk, One of the Manchester NH's area Leading Agents (Godzyk Real Estate Services) over 8 years ago

I am closing on my 3rd RD loan in a few months - best thing since sliced bread.  And while we're out of RD funds in Oklahoma temporarily, several local Lenders are lending and will wait to be reimbursed, so keep inquiring if you're told you're on a waiting list. Absolutely love RD - making the impossible POSSIBLE!

Posted by Lori Cain, Midtown Tulsa Real Estate Top Producer (eXp Realty) over 8 years ago

Most of my market area is not rural, but part of it is, and this loan program is underutilized in my opinion. You've inspired me to get going and use it to promote some somstings I have in those counties. 

Posted by J. Philip Faranda, Broker-Owner (J. Philip Faranda (J. Philip R.E. LLC) Westchester County NY) over 8 years ago

Joe, this is a great post.  I did not know about this program.  Just happened to be talking to a potential client this morning that this program might work for! 

Posted by Delores Campbell, Your St. Louis Real Estate Resource (Keller Williams Realty - Chesterfield) over 8 years ago

USDA loan is my favorite and very popular here in Southwest Louisiana, it has helped many first time homebuyers get into a home with no money down.  80% of my business is with buyers who obtain USDA loans

Posted by Marilyn Boudreaux, Lake Charles LA Century 21 Realtor (Marilyn Boudreaux, Century 21 Bono Realty) over 8 years ago

Sheesh! I stepped away from my computer, came back & look at all the positive feedback! I had no idea this product was so important!  In the words of my 14 year old niece - SWEEEEEETTTT!!!!

@Joan - similar to Lori Cain, my lenders are funding & waiting to be reimbursed.  Ya gotta love it!
@Pam - Thank you, tell young grasshopper this quote - " Everything looks impossible for the people who never try!
@Janna - Awesome! I'm glad you guys are working it!
@Gita - Hey Gita, hope all is well. If you ever need an intro to USDA in your office, let me know. I would like to talk offline with you as well.
@Cheryl - You're welcome and BTW I'm jealous.  I love Maryland as I'm a fisherman & crabber!
@Scott - 2nd person from NH! Pretty cool. Hey thanks.  I try to put my own personality in it. I have the sarcastic Gen X, 80's/90's kid sense of humor so I try to use that humor to teach. I find that people enjoy the reading & learn at the same time.
@Lori - 3rd loan huh? Sweet. Keep it going superwoman!!
@J. Philip - Agreed 100%, it's underutilized. In my area we don't use it anywhere near enough.
@Delores - I'm not happy with St. Louis. You knocked out my Phillies but I'm glad you learned something. :-)
@Marilyn - Awesome! You guys in Louisiana are doing it right! 80%?! WOW!! Good job. I'm jealous of you guys too. I have a good friend who tells me I have to make it down there to do some fishing with him. Hope to visit soon.

Posted by Joe Gonzalez, NMLS# 126036 (610) 739-6563 (CrossCountry Mortgage, LLC NMLS #3029) over 8 years ago

Fantastic post, Joe! And you made USDA fun to read :-)

Posted by Chik Quintans, Seattle FHA Jumbo Mortgage, Pre Approval,FHA 203k,VA,USDA,Homepath (TeamCQ - Atlas Mortgage A Division of Pinnacle Capital Group) over 8 years ago

@Chik - thanks buddy! I appreciate it!

As a follow up, I decided to post the updates.  Feel free to check it out at

Posted by Joe Gonzalez, NMLS# 126036 (610) 739-6563 (CrossCountry Mortgage, LLC NMLS #3029) over 8 years ago