USDA Eligibility Guide
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Kellogg, MN USDA Loan Eligibility Guide
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- The home must be located in a USDA-eligible rural or suburban area around Kellogg, MN. 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:
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- 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 Kellogg, MN 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:
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- 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 Kellogg USDA mortgages, eligibility details can change. It’s always a good idea to consult with one of our Kellogg, MN USDA home loan professionals. Get pre-approved with our easy and stress free Kellogg, MN USDA home mortgage today.
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More About Kellogg, Minnesota
Kellogg is a city in Wabasha County, Minnesota, along the Zumbro River. The population was 456 at the 2010 census.
Kellogg was laid out in 1870, and named for a railroad sign maker. A post office has been in operation at Kellogg since 1872. Kellogg was incorporated in 1877.
According to the United States Census Bureau, the city has a total area of 0.31 square miles (0.80 km2); 0.30 square miles (0.78 km2) is land and 0.01 square miles (0.03 km2) is water.
U.S. Route 61 and Minnesota State Highway 42 are two of the main routes in the community.
As of 2000 the median income for a household in the city was $37,885, and the median income for a family was $40,515. Males had a median income of $28,125 versus $22,885 for females. The per capita income for the city was $16,216. About 6.5% of families and 14.0% of the population were below the poverty line, including 18.8% of those under age 18 and 9.5% of those age 65 or over.