USDA Eligibility Guide
“Find out if you’re eligible for a USDA home loan with Smart Mortgage!”
Oregon, IL USDA Loan Eligibility Guide
1. Property Eligibility:
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- The home must be located in a USDA-eligible rural or suburban area around Oregon, IL. 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 Oregon, IL 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 Oregon, IL USDA mortgages, eligibility details can change. It’s always a good idea to consult with one of our Oregon, IL USDA home loan professionals. Get pre-approved with our easy and stress free Oregon, IL USDA home mortgage today.
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More About Oregon, Illinois
Oregon (/ˈɒrɪɡɒn/ ORR-ig-on) is a city in and the county seat of Ogle County, Illinois, United States. The population was 3,721 in 2010.
The land Oregon, Illinois was founded on was previously held by the Potawatomi and Winnebago Indian tribes. In fact, later, settlers discovered that the area contained a large number of Indian mounds, most 10–12 feet (3.0–3.7 m) in diameter.
Ogle County was a New England settlement. The original founders of Oregon and Rochelle consisted entirely of settlers from New England. These people were “Yankees”, that is to say they were descended from the English Puritans who settled New England in the 1600s. They were part of a wave of New England farmers who headed west into what was then the wilds of the Northwest Territory during the early 1800s. Most of them arrived as a result of the completion of the Erie Canal. When they arrived in what is now Bureau County there was nothing but a virgin forest and wild prairie, the New Englanders laid out farms, constructed roads, erected government buildings and established post routes. They brought with them many of their Yankee New England values, such as a passion for education, establishing many schools as well as staunch support for abolitionism. They were mostly members of the Congregationalist Church though some were Episcopalian. Culturally Bureau County, like much of northern Illinois would be culturally very continuous with early New England culture, for most of its history.
The first European to visit the land was pioneer John Phelps. Phelps first visited the area in 1829 and returned in 1833 hoping to find a suitable site to settle. Phelps found a forest and river-fed valley which impressed him enough that he built his cabin there. Other pioneers followed Phelps to this site, and Phelps helped create the first church, school, grocery store, blacksmith shop, and post office in Oregon. By December 4, 1838, due in large part to the efforts of Phelps and his brothers B.T. Phelps and G.W. Phelps, the land was claimed, subdivided and certified by the Ogle County clerk as Oregon City. The name Oregon means “River of the West”.
In 1839, Oregon City was renamed Florence after a visitor compared the scenic beauty of the Rock River to the Italian city of the same name. Florence was used for only about three years when the city opted to revert to its original name, without the word “city,” in 1843. By 1847 the town had a general store, sawmill, ferry, 44 households and a population of 225. The population continued to grow through the 1850s and 1860s, a fact demonstrated by the increasing number of churches in those decades and the building of a railroad in 1871. Industry followed the railroad and Oregon became home to an oatmeal mill, furniture factory, chair factory, flour mill and a foundry, Paragon Foundry, which operated until the 1960s.