Apple Valley, MN USDA Eligibility

USDA Eligibility Guide

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Apple Valley, MN USDA Loan Eligibility Guide

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

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    More About Apple Valley, Minnesota

    Apple Valley is a city in northwestern Dakota County in the State of Minnesota, and a suburb of the Twin Cities. The population was 56,374 at the 2020 census, making it the 17th most populous city in Minnesota. In 2014, Money.com named Apple Valley the 17th best place to live in the United States, up from 20th in 2010, 24th in 2008 and 28th in 2007.

    The area that became Apple Valley was first established in 1859 as Lebanon Township, and remained a farming community for nearly a century. In the mid-1950s, residential developments started replacing farmland. Orrin Thompson, a real estate developer, was responsible for the city’s early development. He contracted a company to determine where the next growth in the Twin Cities would be. It was 0.5 miles (1 km) from County Road 42 and Cedar Avenue. Thompson bought the first houses and streets from the Brobacks, who built the city’s first four houses. The firm that selected this area was in Apple Valley, California, so Thompson took that name for the development. An alternate explanation for the name change exists, however. According to local developer Henry Broback, Lebanon Township was renamed Apple Valley because “…when you drive east on (County Road) 42 and turn to enter Lebanon, it reminded them of Apple Valley, California, which was a nice community.”[failed verification]

    Voters in the township voted to incorporate in the 1968 general election. They also selected the name Apple Valley over the name Lebanon Valley by a vote of 1376 to 757.

    According to the United States Census Bureau, the city has a total area of 17.57 square miles (45.51 km2), of which 16.86 square miles (43.67 km2) is land and 0.71 square miles (1.84 km2) is water. The city’s geography is rolling, with elevation from the lowest to the highest points in the city varying by one hundred feet (thirty metres) or more. The downtown area and its adjacent residential district (which formed the original core of the city when it was incorporated) are in a shallow valley.

    Apple Valley is in Minnesota’s 2nd congressional district, represented by Angie Craig, a Democrat. Apple Valley is represented in the Minnesota Legislature by State Senator Greg Clausen (Democrat, District 57), Representative Robert Bierman (Democrat, District 57A), and Representative John Huot (Democrat, District 57B).