Palestine, IL USDA Eligibility

USDA Eligibility Guide

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Palestine, IL USDA Loan Eligibility Guide

A USDA (United States Department of Agriculture) mortgage, also known as a Palestine, IL USDA Rural Development Loan, is designed to assist low-to-moderate-income households in purchasing homes in eligible rural and some suburban areas. Here are the general eligibility requirements:

1. Property Eligibility:

    • The home must be located in a USDA-eligible rural or suburban area around Palestine, IL. The USDA provides an online tool to help potential borrowers determine if a specific property is in an eligible area.
    • The property must be used as the borrower’s primary residence.
    • The home must meet all local codes and program regulations.

2. Applicant/Household Eligibility:

    • U.S. citizenship or permanent residency is required.
    • The borrower must be unable to obtain a loan from other resources on terms and conditions that can reasonably be expected to meet.
    • The applicant must have a stable and dependable income, typically verified by two years of consistent employment. The income must also be sufficient to cover the mortgage payment, including taxes and insurance.
    • The household’s adjusted income must be at or below the applicable low-to-moderate income limit for the area.
    • A reasonable credit history. While a specific credit score is not mandated, a credit score of 640 or higher is typically required for streamlined processing. However, those with lower scores may still be eligible but may undergo a more stringent evaluation.

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    3. Income Limits:

    • Income limits vary by county and household size. You’ll need to check with our Palestine, IL USDA service center or the USDA’s online tools to see specific limits.

    4. Loan and Debt Ratios:

    • Typically, a 29/41 ratio is followed. This means that 29% or less of your monthly income can go towards your mortgage (Principal, Interest, Taxes, and Insurance) and 41% or less of your monthly income can go towards your total debt (this includes the mortgage and other debt obligations). Exceptions can be made in certain circumstances.

    5. Other Requirements:

    • Borrowers must personally occupy the dwelling as their primary residence.
    • The borrower must be legally able to take on the loan obligation.
    • First-time homebuyers are required to take a homeowner counseling class in some situations.

    6. Loan Terms:

    • The loan term is typically 30 years.
    • No down payment is usually required.
    • The interest rate can be set by the lender but is subject to USDA review.

    7. Guarantee Fee and Annual Fee:

      • The USDA charges an upfront guarantee fee, which can be rolled into the loan amount.
      • There’s also an annual fee, which is a percentage of the remaining principal amount, typically spread out in monthly installments.

    It’s crucial to remember that while these are the general requirements for Palestine, IL USDA mortgages, eligibility details can change. It’s always a good idea to consult with one of our Palestine, IL USDA home loan professionals. Get pre-approved with our easy and stress free Palestine, IL USDA home mortgage today.

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    Mortgage Resource Center

    More About Palestine, Illinois

    Palestine is a village in Crawford County, Illinois, United States. The population was 1,233 at the 2020 Census.

    According to the 2010 census, Palestine has a total area of 0.79 square miles (2.05 km2), all land.

    It is said that French explorer Jean Lamotte first gazed upon this region in 1678. He gave it the name Palestine, as it reminded him of Palestine.

    Palestine was chartered in 1811, while the area still belonged to Virginia, and is one of the oldest towns in the State of Illinois. It was named the seat of Crawford County in 1818. Elections in 1843 moved the county seat to a new site, which would become the town of Robinson. It was officially incorporated as an Illinois town in 1855.

    As of the 2020 census there were 1,233 people, 578 households, and 347 families residing in the village. The population density was 1,562.74 inhabitants per square mile (603.38/km2). There were 654 housing units at an average density of 828.90 per square mile (320.04/km2). The racial makeup of the village was 94.97% White, 1.22% Asian, 0.41% from other races, and 3.41% from two or more races. Hispanic or Latino of any race were 0.81% of the population.