Greendale, WI USDA Home Loans vs Greendale, WI 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 Greendale, WI 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.
Greendale, WI USDA Home Loans
1. What it is: The Greendale 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 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.
Greendale 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 Greendale, WI 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 Greendale, WI 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 Greendale, WI 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 Greendale, WI have income caps which could rule out higher earners, while FHA loans in Greendale, WI do not.
To make the best decision, consider speaking with a mortgage professional who can provide advice tailored to your situation. Both Greendale 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 Greendale, WI USDA and FHA loan options? Call today (888)416-4805.
We service the following areas in Wisconsin for FHA and USDA loans.
Learn more about Greendale
Greendale is a village in Milwaukee County, Wisconsin, United States. The population was 14,854 at the 2020 census. Greendale is located southwest of Milwaukee, Wisconsin, and is a part of the Milwaukee metropolitan area. A planned community, it was established by the United States government during the Great Depression.
The first recorded inhabitants of the Greendale area were various Native American tribes, including the Potawatomi. The 1833 Treaty of Chicago struck an agreement between the United States government that required the Chippewa, Odawa, and Potawatomi tribes to cede to the United States government 5,000,000 acres (2,000,000 ha). In exchange for ceding their lands in the area, they were to receive monetary payments and lands west of the Mississippi in Indian Territory.
Greendale was one of three government sponsored “Greenbelt” communities constructed by the Resettlement Administration, starting in 1936, as part of President Franklin Roosevelt’s New Deal. The other Greenbelt communities were Greenbelt, Maryland and Greenhills, Ohio. Greendale was incorporated as a village on November 1, 1938. The planners and selection committees excluded African-American families from renting homes and created a racially segregated and all-white suburban community.
The original downtown area included the village hall, built in a Colonial Williamsburg style, 366 new homes comprising 572 living units, and several businesses. These homes were often referred to as “Greendale Originals”. The Greenbelt communities were patterned after the British garden city movement urban planning concept, built so residents could walk to schools, shops, and parks. Greendale was intended to be a model village for the working class. Income limits were from $1200 to $2700 per year, depending upon family size. In 1938, a one-bedroom Original rented for $19 a month. Rent for a four-bedroom home was $46 a month. Over 200 of the “Originals” have unique artistic designs on the chimneys.
Federal ownership of Greendale ended in 1953. In the late 1950s Greendale experienced growth in conjunction with the expansion of the Milwaukee suburbs as a whole. Although new homes were built and the number of minority families increased in Milwaukee County, racially restrictive covenants were used to maintain the all-white Greendale community. In 1958, the Crestview Acres land was sold by Elroy H. Barbian for development with the restrictive covenant that only white families could purchase the homes. “No Persons other than the white race shall own or occupy any building on said tract, but this covenant shall not prevent occupancy of persons of a race other than the white race who are domestic servants of the owner or occupant of said building.”