Milton, FL USDA Home Loans vs Milton 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 Milton, FL 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.
Milton, FL USDA Home Loans
1. What it is: The Milton, FL 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.
Milton, FL 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 Milton 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 Milton 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 Milton 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 Milton, FL have income caps which could rule out higher earners, while FHA loans in Milton, FL do not.
To make the best decision, consider speaking with a mortgage professional who can provide advice tailored to your situation. Both Milton, FL 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 Milton, FL USDA and FHA loan options? Call today (888)416-4805.
We service the following areas for FHA and USDA loans.
Learn more about Milton
Milton is a city in and the county seat of Santa Rosa County, Florida. It is located within the Pensacola Metropolitan Statistical Area. Milton is located in the geographic center of Santa Rosa County and it is bordered by Pace to the west, and Navarre to the South. As of 2020, the population of the city of Milton was 10,197.
The town was incorporated in 1844 and is home to Naval Air Station Whiting Field.
Milton was known by various names during its development. Most notable were “Hell-Town” (muggy, inhospitable land covered with briars, mosquitoes, thorns, snakes) “Jernigan’s Landing”, “Scratch Ankle” (due to the briars that grew along the riverbank), and “Hard Scrabble.”
According to Florida historian Allen Morris, “Just which Milton was honored by the final name is a dispute. Some say it is a contraction of an earlier Milltown; others that it was Milton Amos, pioneer and ancestor of the present Amos family; still others that it was John Milton—not the English poet, but the Civil War governor of Florida.”
Milton was settled in the early 1800s as a small village centered on the lumber industry. The settlement originally was known as Scratch Ankle because of the briars and bramble that grew in the area. Another name was Jernigan’s Landing after Benjamin Jernigan (died April 1847), who built a water-powered saw mill at what is now Locklin Lake between 1828 and 1830. Other names were Lumberton, Black Water, and Hard Scrabble, but by 1839, it was being referred to as Milltown. Milton was incorporated as a town in 1844, one year before the Territory of Florida joined the United States as the 27th state.