The Villages, FL USDA Eligibility

USDA Eligibility Guide

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The Villages, FL USDA Loan Eligibility Guide

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

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    Mortgage Resource Center

    More About The Villages, Florida

    The Villages is a census-designated place (CDP) in Sumter and Marion counties in the U.S. state of Florida. It shares its name with a broader master-planned, age-restricted community that spreads into portions of Lake County. The overall development lies in central Florida, approximately 20 miles (32 km) south of Ocala and approximately 45 miles (72 km) northwest of Orlando. As of the 2020 census, the population of the CDP was 79,077.

    The Villages covers an area of approximately 32 square miles (83 km2), an area larger than Manhattan, and is expanding mainly to the south of the current community. It is made up of 17 special purpose community development districts (CDD), which are controlled by a board of supervisors (BoS), five individuals elected by the landowners of the district. H. Gary Morse, the original owner’s son, transferred most direct ownership in the company to his three children in 2006; Morse died in 2014.

    The community is the center of The Villages metropolitan area, which consists of all of Sumter County and is included in the Orlando–Lakeland–Deltona combined statistical area; and Marion County is included in the Ocala, Florida Metropolitan Statistical Area. According to May 2023 Census Bureau data, between July 1, 2021, and July 1, 2022, The Villages metro area grew by 7.5% or 10,103 people to 144,970 residents. The area was the fastest-growing metropolitan statistical area in the country.

    Harold Schwartz, a Michigan businessman, began selling land tracts via mail order in The Villages area in the 1960s. He and his business partner, Al Tarrson, were forced to close this aspect of the business following the implementation of a 1968 federal law banning real estate sales by mail order.

    Stuck with considerable portions of Florida land, in the early 1970s, Schwartz and Tarrson began the development of a mobile home park, Orange Blossom Gardens, in the northwestern corner of Lake County. By the early 1980s, the community had sold only 400 units. Schwartz bought out Tarrson’s interest in improving the business and brought his son, H. Gary Morse, on board in 1983.