Jeffersonville, IL USDA Loans VS FHA Loans

Jeffersonville, IL USDA Home Loans vs Jeffersonville, IL 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 Jeffersonville, IL 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.

Jeffersonville, IL USDA Home Loans

1. What it is: The Jeffersonville, IL 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.

Jeffersonville, IL 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 Jeffersonville 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 Jeffersonville, IL 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 Jeffersonville, IL 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 Jeffersonville, IL  have income caps which could rule out higher earners, while FHA loans in Jeffersonville do not.

To make the best decision, consider speaking with a mortgage professional who can provide advice tailored to your situation. Both Jeffersonville, IL  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 Jeffersonville, IL USDA and FHA loan options? Call today (888)416-4805.

We service the following areas for FHA and USDA loans.

Learn more about Jeffersonville, Illinois

Jeffersonville is a village in Wayne County, Illinois, United States. The population was 366 at the 2000 census.

Although its official name is Jeffersonville, the village is known locally as Geff, with that spelling appearing on local road signs, the US Post office, and many official documents. “Geff” is pronounced as though it were spelled “Jeff”. The name change is said to have been made during the 19th century by the railroad, in order to distinguish the village in Illinois from Jeffersonville, Indiana.

Burton Hawk and his brother ran a sawmill near Geff and Fairfield. William Edwin Hawk was married to Alice Mathews, also of Fairfield. His sister, Mary Adeline, was married to Dr. Dade A. Hilliard. Mellie Ann Gray was the daughter of Thomas and Rebecca Gray. She married Burton Hawk on October 31, 1894. Burton and William’s parents, Eliza Jane and David Hawk ran a general store and his son Hamby ran it after David’s death in December 1916. They eventually all dispersed to Tonica, Marseilles, Lostant or Springfield Illinois.[better source needed]

Also, according to genealogytrails.com, David Hawk was a “Dealer in Staple and Fancy Groceries”. “One of the most important business of any town larger or small, is the grocer and Mr. Hawk fills this capacity in Jeffersonville. …in 1865 he and his wife Eliza moved to Wayne County. He began the grocery business in Jeffersonville in March 1901. He has the only exclusive grocery store in town, and makes a point to keep everything the people want in his line…. a gentleman to deal with.”[citation needed]

According to the 2010 census, Jeffersonville has a total area of 1.02 square miles (2.64 km2), all land.