Andover, MN USDA Eligibility

USDA Eligibility Guide

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Andover, MN USDA Loan Eligibility Guide

A USDA (United States Department of Agriculture) mortgage, also known as a Andover, MN 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 Andover, MN. 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 Andover, MN 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 Andover USDA mortgages, eligibility details can change. It’s always a good idea to consult with one of our Andover, MN USDA home loan professionals. Get pre-approved with our easy and stress free Andover, MN USDA home mortgage today.

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    More About Andover, Minnesota

    Andover is a city in Anoka County, Minnesota, United States. The population was 32,601 at the 2020 census.

    According to the United States Census Bureau, the city has a total area of 34.83 square miles (90.21 km2), of which 33.88 square miles (87.75 km2) is land and 0.95 square miles (2.46 km2) is water. County Roads 9, 18, 78, and 116 are the main routes in the community. U.S. Highway 10 is nearby.

    Crooked Lake is the only fully recreational lake in Andover. It is on the southern border of the city with the majority of the lake in neighboring Coon Rapids.

    Andover first organized in 1857 as Round Lake Township.

    In 1860 after an Anoka, Minnesota speech by U.S. Representative Galusha Aaron Grow from Pennsylvania who was an abolitionist and a major figure in the Homestead Act, the town name was changed to Grow Township.