Homestead, FL USDA Eligibility

USDA Eligibility Guide

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Homestead, FL USDA Loan Eligibility Guide

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

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    More About Homestead, Florida

    Homestead is a city within Miami-Dade County in the U.S. state of Florida, between Biscayne National Park to the east and Everglades National Park to the west. Homestead is primarily a Miami suburb and a major agricultural area. It is a principal city of the Miami metropolitan area of South Florida, which was home to an estimated 6,012,331 people at the 2015 census. It is located approximately 26 miles (42 km) southwest of Miami, and 25 miles (40 km) northwest of Key Largo. The population was 80,737 as of the 2020 census.

    The city of Homestead is located near the southern terminus of the Homestead Extension of Florida’s Turnpike where it ends at its junction with U.S. 1. Homestead is immediately north and east of Florida City, and these two cities comprise the greater Homestead-Florida City area. Some of the notable unincorporated communities in the area are Redland, Leisure City, Naranja, and Princeton.

    Homestead was incorporated in 1913 and is the second oldest city in Miami-Dade County next to the city of Miami. The name originates from when the Florida East Coast Railway extension to Key West was being built. The rail line was passing through an area opened up for homesteading, and as the construction camp at the end of the line did not have a particular name, construction materials and supplies for the workers were consigned to “Homestead Country”, shortened to “Homestead” by the engineers who mapped the area.

    Homestead and neighboring South Miami-Dade County communities bore the brunt of Category 5 Hurricane Andrew on August 24, 1992.

    According to the United States Census Bureau, the city has a total area of 14.4 square miles (37 km2). 14.3 square miles (37 km2) of it is land and 0.1 square miles (0.26 km2) of it (0.63%) is water.