Burlington, IL USDA Eligibility

USDA Eligibility Guide

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Burlington, IL USDA Loan Eligibility Guide

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

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    More About Burlington, Illinois

    Burlington is a village in Kane County, Illinois, United States. The population was 535 at the 2020 census, down from 618 in 2010. It was incorporated as a village on November 6, 1990.

    Burlington was platted by Andrew Pingree in 1851. It is located on the former Illinois Central Railroad which runs through the south edge of the village. In 1878, the area had three cheese factories, a general store, a hotel and a saloon. A post office under the name “Burlington” has been in operation since 1865. The last dairy plant closed in the 1970s.

    Since the early 1990s, Burlington has been home to two small plastics companies. Concerns have been raised over the environmental impact these plants will have on the town and surrounding areas in the future. On November 6, 1990, Burlington was incorporated as a village, along with nearby Lily Lake and Virgil, in an effort to establish stricter guidelines in regards to plastic manufacturing and chemical dumping in the area.

    From 1910 to 2019, Burlington held an annual fall festival on the first week of September every year. Burlington is one of 4 villages in the State of Illinois that allow the use of snowmobiles in town during the winter season.

    Burlington is located near the intersection of Plank Road and Burlington Road. The village cosists of a small “downtown” section, and is surrounded mostly by horse ranches and cornfields. It lies approximately halfway between Elgin and Sycamore, and is 20 miles north of the City of Aurora.