Falcon Heights, MN USDA Loans VS FHA Loans

Falcon Heights, MN USDA Home Loans vs Falcon Heights, MN FHA Home Loans: Which is Right for You?

Homeownership is a dream for many people. To make it achievable for a wider range of individuals, there are various mortgage programs available. Among the most popular are USDA Home Loans and Falcon Heights, MN FHA Home Loans. Both of these loan programs aim to assist buyers, especially those with low-to-moderate incomes, but they serve different populations and have distinct criteria. Let’s delve into the differences and similarities of these two loan types to help you decide which one might be right for you.

Falcon Heights, MN USDA Home Loans

1. What it is: The Falcon Heights, MN USDA Home Loan program is backed by the United States Department of Agriculture (USDA). It’s designed to help rural residents, especially those with lower incomes, purchase homes.

2. Eligibility:

  • Location: Homes must be located in eligible Falcon Heights, MN rural areas as defined by the USDA.
  • Income limits: There are maximum income limits, which vary based on the size of the household and the county in which the property is located.
  • Credit score: While the USDA doesn’t have a set credit score requirement, most lenders require at least a 640 score.

3. Benefits:

  • No down payment: USDA loans allow for 100% financing.
  • Competitive interest rates: Often lower than conventional loans.
  • Low mortgage insurance: The upfront guarantee fee can be rolled into the loan, and the annual fee is generally lower than FHA mortgage insurance.

4. Limitations:

  • Geographic restrictions: The program is limited to certain rural areas.
  • Income caps: Not suitable for those with higher incomes.

Falcon Heights, MN FHA Home Loans

1. What it is: FHA Home Loans are backed by the Federal Housing Administration (FHA). This program aims to help those with low-to-moderate incomes and Falcon Heights, MN first-time homebuyers purchase homes.

2. Eligibility:

  • Credit score: Borrowers need a minimum credit score of 580 to qualify for the 3.5% down payment. Those with scores between 500-579 can still qualify but will need a 10% down payment.
  • Debt-to-Income Ratio (DTI): Generally, the ratio should be less than 43%, but exceptions can be made with compensating factors.
  • Mortgage Insurance: Borrowers are required to pay both an upfront and an annual mortgage insurance premium.

3. Benefits:

  • Low down payment: Requires only 3.5% down with a 580 credit score.
  • Flexible credit requirements: Suitable for those with lower credit scores.
  • Assumable mortgage: An Falcon Heights, MN FHA loan can be assumed by a future buyer, which can be a selling point in a rising interest rate environment.

4. Limitations:

  • Mortgage insurance: FHA loans come with both upfront and ongoing mortgage insurance premiums.
  • Loan limits: There are maximum loan amounts, which vary by county.

Which is Right for You?

Your decision between a USDA Home Loan and an Falcon Heights, MN FHA Home Loan will largely depend on your individual circumstances:

  • Location of Desired Property: If you’re looking at a home in a rural area, the USDA loan might be the best fit. If you’re considering urban or suburban areas, an FHA loan may be the only option among the two.
  • Down Payment: If you don’t have a down payment, a USDA loan, with its 100% financing, can be attractive.
  • Credit Score: If you have a lower credit score, the FHA loan might be more forgiving.
  • Income: Remember that USDA loans in Falcon Heights have income caps which could rule out higher earners, while FHA loans in Falcon Heights, MN do not.

To make the best decision, consider speaking with a mortgage professional who can provide advice tailored to your situation. Both Falcon Heights USDA and FHA loans offer opportunities for homeownership, but the right one for you will depend on your personal and financial circumstances. Questions about the Falcon Heights, MN USDA and FHA loan options? Call today (888)416-4805.

We service the following areas for FHA and USDA loans.

Learn more about Falcon Heights

Falcon Heights is a suburb of Saint Paul and a city in Ramsey County, Minnesota, United States. The population was 5,321 at the 2010 census. It became a village in 1949 and a city in 1973.

Falcon Heights is the home of the University of Minnesota’s St. Paul Campus; the Gabbert Raptor Center and Les Bolstad Golf Course, the Minnesota State Fairgrounds, and the Gibbs Museum of Pioneer and Dakotah Life. Its University Grove neighborhood is known for its modern architecture.

Heman Gibbs settled in the 1850s near the modern intersection of Cleveland and Larpenteur Avenues. His homestead is on the National Register of Historic Places and his home is a county museum.

On September 2, 1901, then-Vice President Theodore Roosevelt first publicly used the African proverb “Speak softly and carry a big stick” in a speech at the Minnesota State Fairgrounds, which was still a part of St. Paul at the time. Roosevelt became president just two weeks later, upon the assassination of William McKinley, and built the phrase into his concept of Big Stick Diplomacy.

Between the 1910s and 1930s, Curtiss Northwest Airport was located at the intersection of Snelling and Larpenteur Avenues. The airfield was important in Minnesota aviation history, hosting Charles Lindbergh, Speed Holman, and Phoebe Fairgrave. Part of the land is now a city park named Curtiss Field.