Credit Score Requirements for USDA Loans
March 31, 2008 by Eleanor
Filed under Loan Programs, Uncategorized
USDA loans are perfect for people who want a home in a more rural area. In Wake County most of Fuquay Varina, Garner, Holly Springs and Apex all fall within the acceptable areas. To find out if the property you are interested in will be in a USDA area check here.
In general, these are the items that the underwriters for USDA loans are looking for:
- No minimum credit scores
- 1 payment in the last 12 months could have been no more than 30 days late – Exceptions may be granted if you have 620 or greater middle credit scores
- Chapter 7 and 13 must be discharged for 3 years – Foreclosures must be completed 3 years ago – Exceptions may be granted if your borrowers have 620 or greater middle credit scores. This is significantly more strict than FHA or VA loans.
- Collections – Accounts cannot have been placed in collection status within the last 12-months – Exceptions may be granted if your borrowers have 620 or greater middle credit scores. Collections May not need to be paid off. This is especially true for Medical Collections.
- Judgements – Must be paid off for at least 12 months This has gotten to be a big deal lately. Judgements can attach to the property you purchase and become a first lien.
- If the applicant’s middle credit score is under 620 a written verification of rent is required for the most recent 12 months. However, previous Housing History is Not required.
- Non-Traditional Credit is Acceptable if no credit is available
If you are considering a USDA loan, contact STEVE AND ELEANOR THORNE Meridian Residential 919-649-5058.
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