2023 USDA Loan Requirements - Complete Guide For First Time Home Buyers

The USDA Zero Down Rural Development Loan is a great way to buy a house in 2023! In this video, first time home buyers will learn the differences between the Direct and Guaranteed loan types, how to apply for the USDA rural development loan, who qualifies for the loan and what type of properties can be bought!
✨NEW 2024 First Time Home Buyers Guide: • Buying a House in 2024... ✨
Home Buyer Tools:
✅Get connected with an AGENT in your city → homeandmoney.com/nicole/
🔎 → Search RD Eligible Areas: eligibility.sc.egov.usda.gov/...
🔎 → Check Income Limits in Your Area: www.rd.usda.gov/files/RD-GRHL...
🔎 → Find Your USDA Office: offices.sc.egov.usda.gov/loca...
🔎 → Find a USDA Guaranteed Lender in Your Area: www.rd.usda.gov/sites/default...
Work with Nicole in Arkansas:
🏠 View AR Homes For Sale → listings.narkhomes.com/i/arka...
📩 Contact Nicole → narkhomes.com/contact/
Other stuff that's cool:
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(As an Amazon Associate I earn from qualifying purchases)
Social Media Links:
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📱 Facebook → / nicolenarkrealtor
Chapters:
00:00 - Intro
00:16 - What Is The USDA Loan?
01:13 - How Can I Get It?
04:40 - Direct vs Guaranteed Qualifications
09:30 - Property Requirements
12:17 - Applicant Qualifications
14:07 - Helpful Tips
- DISCLAIMER -
Nicole Nark is a licensed Realtor and the Principal Broker (PB00083374) of HomeWay Realty. HomeWay Realty is not a lender, does not issue loan qualifications, and does not extend credit of any kind. The topics discussed, and ideas presented are Nicole Nark's opinions and presented for entertainment purposes only. The information presented should not be construed as financial or legal advice. Always do your own due diligence.

[@dianyadira]

I used USDA for my first home loan. It helped me become a home owner by myself before my husband and I married. Very proud of myself.

[@NicoleNark]

That’s incredible Diana!

[@thenenej]

This gives me hope lol congratulations 🎊

[@pilarramirez9441]

Whats bank you use for get this loan for uSDA I’m looking for

[@dianyadira]

@@pilarramirez9441 I used First United for my bank loan. They were easy to work with and knowledgeable.

[@jahzicarino992]

What was your credit score when you applied ?

[@LightingLotusLove]

I Am A Homeowner, I Can Do it, the entire process is easy for me, I deserve it, I Deserve stability, it is done ✅ 😊

[@LightingLotusLove]

@@samanthajohn7088 thanx

[@sleeprelaxbeatinsomnia5904]

Amen

[@blackwolf7777]

"Don't worry! You don't have to live on 20 acres in the middle of nowhere!" But, that's the thing I want to do!

[@davyannajones]

There are no set limit home price… except there is. The limit is set by your area. You can’t make more than 115% of the median income of the area. So for example the median income in my area is about $76k. You can’t make more than $87k. With a 5% interest rate that means you can’t get a house over $345k with this program.

[@Imamachine7]

I can’t believe so many people don’t know about this. Bought two houses since 2010 with this type loan.

[@sherrybradshaw6504]

Please tell me how. I was preapproved for a small loan but thats all i received. I have no idea of how this program works other than what im reading on KZbin. The people in my state are very unhelpful. I feel like Ive been dropped. No help whatsoever. No follow up. Seriously, how did you accomplish this?

[@tammywilliams9138]

Can you do a video on how to buy a home through USDA on SSI and Social security

[@Peejayyesthetics]

Hi Nicole! Where have you been all my life! You explain everything soooo well and very well articulated. Thank you for all efforts in putting these great videos out! ❤

[@fsmith68]

i knew basically nothing about buying a home, and the more i researched the more confused i became....and then i found you Nicole....what a blessing you have been to my life...thank you soooo much for taking the time to explain "everything that we need to know". Very much appreciated!

[@NicoleNark]

Thank you so much for the kind words! It means a lot to me to know that you get value from my videos! 🥹

[@lisag.4054]

This made me giggle. I too, am here because I know nothing about buying a home and have become more confused with research 😂

[@Gator805]

We're 4 months into the process. Went for a 502 direct. Our rate is 3.25 % because we applied before December 1, 2022. It's a very slow process. Thanks for your guidance.

[@NicoleNark]

Absolutely! Hopefully your file moves along soon!

[@iamthatiam9936]

4 MONTHS ?😳 I hope you have your home now

[@BC-wg5pq]

Hay, are you in Washington state?

[@BC-wg5pq]

Do you know where that rule in on the USDA website? We have our loan, got it in November 2022 and we have a 4% .....

[@sarahleeblanc8274]

@@BC-wg5pqgoogle It

[@jillmorton3096]

Thank you so much for this. I knew all of what you said as going through a direct loan. For me its an easy process im dealing with two people through USDA process which they both take the time to go over things with me as I had many questions. So far so good. 🙃🙂 tomorrow is the inspection..God willing as there is another storm coming

[@briangrant2005]

This was extremely helpful! I just moved to a new town, and I finally feel like I can put down roots. A friend of mine who's a realtor mentioned this, and I've been going nuts researching! Hugely concise video! I'll pass it on to my friends who would love their own home to call their own!

[@elisafisher3804]

Very educational! Thank you, the lender I used DID NOT explain all this to me, nor do they advertise their rates unless you sign a contract. Now I know my options, Thank you Nicole, you're my Angel. Thank You Thank You Thank You, Im glad I found this video.

[@krissiebrown2600]

That’s great no money down and low payments if you can’t afford the payment that they offer and it’s great that you don’t have to go through the owner only the lender process and working with USDA directly and to be able to close in a 30 day period is also definitely great. No credit score minimum is definitely great too and you only have to meet some direct specific route.

[@nvwi9687]

That's how I got my first house with no money they just signed a bunch of papers and they gave me the key 🗝️

[@kiab-mylifemyway7647]

Listen here when I say that you have been a wealth of knowledge. This journey to home ownership is something else. I truly appreciate your time, efforts and and excitement on the topics and to bring knowledge. Ive subscribed

[@LightingLotusLove]

Thanx so much Nicole 😊❤ I’m a single mom and I know that I am a home owner 😊 you’re helping me so much 😊

[@silviamartin5583]

I will always be so thankful for you and these videos. Because of you, I learned so much about this loan and you set me up with a realtor in the area of Arkansas I was moving to. I recommend to do as much homework as possible. Remember, the lenders, realtors, and escrow people are there to help you and not work against you. I had the best experience and I appreciate that so much especially being a first time home buyer.

[@NicoleNark]

Great points Silvia! You are the sweetest and I am so glad we set you up for success when moving to Arkansas! 💕😊

[@WarmongerYT]

Congrats! I currently live in Conway Arkansas (originally from Ozarks in Arkansas) & am wanting to buy 1 to 2 acres & build a 605 square foot house on said acres. Did you end up using a USDA loan if you don't mind my asking? I've been considering FHA. My credit score is 711 , we make $54k per yr & only have my car payment $320 per month.

[@silviamartin5583]

@@WarmongerYT yes, I did use a USDA loan.

[@georgehuerta1990]

@@NicoleNark how does this type of program help if I’ve already bought the property does it help me if I want to build a home.

[@billclisham8668]

Thank you Nicole, This video was well thought out and produced. I learned quite a bit from your information.

[@NicoleNark]

You are so welcome! Glad it was helpful 🎉😊

[@charlynrenee2114]

Thanks! This was very educational and helpful in understanding a little bit more of the process.

[@NicoleNark]

Thanks for watching! Glad it was helpful! ☺️

[@SoniaGonzalez-bm9bw]

Thank you for sharing you knowledge. This is a very well detailed helpful video 🙌🏽

[@LadyEL4]

I plan on using this loan when I move to South Carolina. I do have money for down payment already. I just want to make sure Im fully covered. 😂 Thank you for your help!!!

[@Tahvyy]

Thanks for this video 🤩. I recently inquired about the loan at my credit union and they never mentioned that I possibly could roll the closing cost in the loan. He said I would have to leave the closing cost in my account for 60 days. 🤨 Should I just go direct or try another lender that offers the program. I’m in VA. Thanks 😊

[@asiam9678]

Great job explaining. I closed on my home with a Direct loan (Texas) in September of 2021.

[@NicoleNark]

That is awesome! Congrats on becoming a homeowner 🙌

[@mortgagewithclare]

This loan offers the perfect way for you to purchase a property without having to come up with a down payment. Plus, you could qualify for a low-interest rate and 30-year loan payment plan.

[@LOLZHAHANOTFUNNY]

My husband and I used this program in 2019, bought a modest house with a 3.25% interest rate, $850 monthly payment. We were so glad to get out of renting and now have more than $70k in equity.

[@8split2]

How to get low interest rate?

[@deejeanlee]

​@@8split2improve your credit scores.

[@unknowndriver6652]

​@@8split2low interest rates mean maybe 1% you aint getting 3 or 4% if thats what you thinking

[@8split2]

I have a repossession with a 650 fine on my credit. It's been 3 years, should I pay it or let it fall off

[@aracelisortiz8563]

Hi Nicole. Thank you for this information. Do you have any recomendation for USDA loan process officer for Pennsylvania....eventhough we live in NY.

[@robertobrown5542]

Hi Nicole, do you have anything for commercial property or land in Florida that get help from the government? Thank you Nicole. You're Rock

[@luvz1wish]

Wow! thank you so much for this info! very detiled! much appreciated!

[@NicoleNark]

You're very welcome! Glad it was helpful ☺️

[@ivisr5142]

Thank you so much for the video! Very detailed and explained so well

[@NicoleNark]

Glad it was helpful! ☺️

[@JS-xs5hq]

Thank you for this update. With a 100% financing, how much rainy day savings do the underwriters want to see in your account......even with a half decent credit score?

[@_poetz9738]

Most states are severely understaffed and they cannot keep up with the flow. This is not an underused program. They are overwhelmed and will take a very long time to respond or not respond at all in many states. Plan accordingly.

[@biz4smitty]

Hi Nicole, are you speaking of the seller’s credit option to bring your payment down?

[@RandalLovelace]

Very informative video, I was able to pause and take notes, as I am looking now for how to get a loan in order to get my own place. The information you shared here, shows that a USDA loan may be a good fit based on the area I live and my current income. Thanks.

[@NicoleNark]

Happy to help, Randal!

[@MightyMoeDaFarmer]

Could you do the same breakdown with farm and business rural area loans through the USDA? Love the way you break this down.

[@workwithCandy]

May I ask what you did with it? I would Like to buy multi fam housing. Can these funds be used for this?

[@chrisitl]

I have a question. What if for the direct loan, I meet all the qualifications except I do live in a decent apartment? Would that disqualify me for the direct loan? Also I was laid off during covid and I just started working last year again around April, what if one year of income is all I have?

[@sharonlee43]

You explained this so well and in great detail! Thank You!!!

[@NicoleNark]

You are so welcome!

[@frantzyaubin6744]

Hey Nicole, I was wondering if USDA allows for a non-occupanying co-borrower to get pre-approved.

[@fredmjohnson183]

you are the best as far as can i tell thank you Nicole

[@NicoleNark]

You are welcome Fred! Thanks for watching ☺️

[@KatSolovei]

As always, the best information! I'm located in NC and wanted to apply for Direct. 2+ years to process in Forthys County. I asked the officer why the wait time is so long, and he answered that there are just 2 people in his department who had to work on 4 (!) USDA programs. They're extremely understaffed. He gently asked me to go the Guaranteed road

[@NicoleNark]

Thanks for watching Kateryna! In most cases the guaranteed route is much faster than the direct route. If you can make it happen, its often the way to get around the long wait times!

[@gladbunny3276]

About how long of a wait is it on avg. We currently live in Wa state? Gee.. you'd think because "being without proper safe housing that they would find a way to expedite services as long as the borrower has all thier ducks in a row And are anticipating and waiting for thier home and the next venture in life!

[@WarmongerYT]

@@gladbunny3276 Our gov or anything having to do with government does NOT care even slightly about us peasants.

[@DAY2DAYY]

@@NicoleNark ? If someone has 2 scores higher than the third. Which two are used

[@gr82bloved43]

Here’s an off the wall question for Nicole. My husband and I moved to Texas - bought a house (he’s on the mortgage & I was out on the title because we’re married ) So if I wanted to buy my own house since I’m not on the mortgage - could I use usda by myself ?

[@livinfaithfully]

I have been doing research and am I understanding correctly that I can purchase the land, new construction build, and mortgage all rolled into using USDA using the Guaranteed and 524 loan?

[@newcreature7733]

Thank You for the useful information. Can you recommend a lender that works with Alabama families seeking a USDA guaranteed construction loan. Thank You kindly

[@LalaAwesum]

Thank you so much for sharing this knowledge! Do you have any information about getting a USDA loan for a manufactured home on raw land? Do things like water, septic and electrical already have to be set up?

[@BBookman713]

Thank you for the helpful video. My only question is with this particular loan, wouldn’t your monthly payments be higher?

[@TheRateUpdatewithDanFrio]

AMAZING VIDEO AS USUAL Nicole

[@welcometosusansmukbang9215]

🎯Good video 👍 Our government and banks are making USDA, FHA and Conventional loans difficult. Who came up with these stupid rules??? Buying a house should be simple process similar buying a car. This is why 99.9% of people have stress and anxiety. Life is too short. Please keep it simple. We don't live on this Earth forever.

[@josecalderon233]

I think 2008 is at fault for this 😂

[@rondadecker2397]

Hello please could you do a video on people that have SSI or retirement income how they could buy a house? If there is any programs available please.

[@IcelandMountains]

Nicole is always very Informative!! Thank u 😊 i really needed this detailed information

[@NicoleNark]

You're so welcome! Thank you for watching ☺️

[@IcelandMountains]

@@NicoleNark you're very welcome! Keep up the Good work Educating Our Communities 📚📝 😉🙂

[@debbievonhoene9726]

I have asked for the USDA DIRECT LOAN PKGfrom my Alabama USDA office 7 weeks ago and got nothing. I again asked for the application from another person in my Alabama office and she said I would not find a home I could afford but I found homes I can afford. I asked for the application almost 3 weeks ago and still I have not received the package. What can I do.

[@quesadillathrilla7132]

Thank you Nicole great information

[@gabrieldineros587]

Could you talk about the USDA "chapter 11 ratio analysis" debt ratio waver 11.3

[@LexiLaconi]

You are awesome Nicole! Such a great video.

[@NicoleNark]

Thanks Lexi! Happy to help ☺️

[@christineplaton3048]

Its my DTI. Thats what I need to deal with. My credits in the 700 to 740 range. The income is fixed. Social Security

[@Sortthingsout-79]

hi there, i love your conent!! Question, i am in California (San Bernardino County) can you speak about new construction eith a breezeway. Would i be on seperate utilities? Thanks

[@edelgonzo]

I had a work history brake due to the corona situation. Will that effect my qualifications?Im trying to buy land and put a manufacture home on it. What would be best route? my DTI ration is very low and my score is above 750+

[@shakeitpopitrollit]

Nice video. Thanks for posting. I would like to apply. However, I can't seem to locate the application on the e-form? Where do I locate the application to get started with the process? Also, is a housing counselor required?

[@kaylaclemmer9037]

You say to get pre-approved first but what I've found is I need to know what house or the address for the USDA loan. Do I have to pick a bunch of places and see if I can get approved hit or miss?

[@quaccface]

Your videos are the best! You explain things very well so thx. I have a question about the direct loan if the area you are looking at is above 300k are even rural areas close. With your credit 640 would they start with that price point to qualify

[@NicoleNark]

It’s a possibility. But you would need to have the income to support that price point!

[@FlyPiggie]

Would a doublewide on a tie down foundation qualify? I live in a area that is 95% manufactured homes. Also it can't be income producing but if i plan to homestead, chickens veggies ect to provide for my own needs would that disqualify or mess anything up after closing if i apply for a homestead credit for property taxes. Not planning on selling anything.

[@thethreebrothers6370]

I already owned a home ,but my house was so small for our family, I wanted to get construction loan and list my current home for rent. Do I still qualify for a USDA program. Thank you

[@louisbengyella6405]

Nicole, this is a great video. Where do I start? I am in PA, state college which qualifies for USDA housing loan. So how to I proceed?

[@sabrinazarry2559]

Do you have any recommendations for USDA lenders in the Tampa,FL area?

[@30pvfd]

Thanks!

[@alyssamarie8635]

how do you prove that you don’t have safe living conditions? i won’t be able to afford my apartment when my lease renews and have been looking into this but how would i prove that?

[@janettsantiago2934]

Thank you !! Excellent information

[@NicoleNark]

Glad it was helpful!

[@Listella.]

Great video and great info!

[@andyh6820]

At 7:00 minutes you talk about guaranteed loan qualifications not exceeding 115% of the area. Can you define area? Is it state or county?

[@Yahkahey]

Very good information! Thanks a lot!

[@NicoleNark]

Glad it was helpful!😊

[@kiab-mylifemyway7647]

I do have a question about this process..how do I get a listing of vacant properties in rural areas? I see an area that qualifies but I dont know how to locate a property specifically

[@yajjmai]

My biggest thing has been the 2 year employment, every lender I’ve talked to has said it needs to be 2 years at same job smh i could’ve been gotten my home but now I’m waiting on the market to calm down

[@NicoleNark]

Nope! As long as you can show 2 years of steady income, most lender will be happy!

[@dawnlara422]

This was great information and was very helpful, you definitely cleared up a lot of my questions. Thank you 👍 also you favor Demi Lovato 😊

[@NicoleNark]

Happy to help! And I’m a big Demi fan so I’ll take that any day ☺️

[@huntercortez4808]

What if you have an medical collection on your credit report, are you still qualified for the USDA loan?

[@beyoutifullynatural9451]

Thank you so much! So much helpful information! I’m in Benton Arkansas so I think this would be perfect for me

[@NicoleNark]

Are you looking to buy in Benton?

[@503DS]

My parents have land in rural Dallas County Arkansas they are willing to give me. My childhood home burned down on the land. So its a clean slate to build a new one. I want to have a 2 br house built on the property. I qualify as low income but don't know where to start.

[@almapinon4299]

Good Morning Nicole thank you for the video

[@NicoleNark]

You are so welcome!

[@mzruffin786]

I would like to know what are some of the closing costs? And, Wonderful video!!! Very detailed explained!

[@NicoleNark]

Thank you for watching! Closing cost are made up of several fees. These include lender fees, title search and document preparation, prepaids for your home insurance, etc. Usually closing costs are close to 3% of your loan amount!

[@greatoztv4200]

Great video! A few questions: for the requirement of not being able to meet 20% of a property with a conventional loan, does that include reserve cash? Does that include or exclude closing costs? What does a person do if they can afford the 20% with the closing costs, but have nearly $0 (otherwise be broke) in the bank? For the 29% requirement, is that just the mortgage loan (principal + interest) or does that include property taxes and insurance? Does the 41% include utilities and other expenses (phone, internet, cable, etc)? Are those percentages measured from gross income or net income?

[@NicoleNark]

The 20% does include reserve cash. It does NOT include retirement accounts like a 401k or IRA. If you have 20%+ you will not be eligible for this loan type. If putting that amount of money down would drain you, then it would likely be better to look at something like a 3.5% down FHA or a 5% down conventional.

[@eo3064]

@@NicoleNark Does the 41% include utilities and other expenses (phone, internet, cable, etc)?

[@NicoleNark]

@@eo3064 Nope! Check out my full DTI video to see a breakdown of everything that is/isn't included! kzbin.info/www/bejne/j6C7lWh-iNN_jbM

[@MaracasEmbroidery]

I think my biggest problem is the back log at the USDA office. They are telling me it's 6 months. Can you do a video on "USDA packagers"? TIA. Nice video. You're lovely. New subscriber here.

[@samuelsanchez7504]

Hi, I have a question: let's say that I live in southeast Florida and I want to buy a property in a rural area in north Florida and move there once it closes., at the time I submit the offer, do I have to live in the rural area where the subject property is located or can I live in another city or state?

[@user-gc7ic7xw8r]

@nicolenark I found 1 acre of lot in Texas it does not have a house on it but it does have neighbors at both sides, is there down payment assistance for that, it is in USDA Eligble area ?

[@AlazeLuxxx]

Hi can you help me please? What are the income limits for Clark County Las Vegas NV?

[@Naturallyme.]

How do you find out which area to buy a house in. Is there a map to see which areas take usda loans?

[@eguerra777]

Nice video but ALL videos in USDA loans I’ve seen don’t mention the following situation: since this loans are aimed a “low income families” and for that matter consider the median income in the area where the target house is located, there is a high change, surrounding properties are also owned by other “low income families”… Typically, properties in this type of areas don’t appreciate in value at the same rate (if they appreciate at all) than other properties in areas of higher income. Please comment about this and point where I may be wrong. Thanks🙏

[@jayvito86]

Great video, i was stuck between Nav fed loan or USDA for my home purchase usda seem to be the better option

[@NicoleNark]

It’s a great option for homes in eligible areas!

[@diannehull9748]

Are closing costs included somehow? If according to the 29% rule, my payment can only be about 1065/ month, about how much of a sales price should I be looking at?

[@Kenquinones]

Nicole, my mom has a property but she is considered low income, since she only make $9600 per year. would she be able to have a house built under the USDA on her property or would she have to look for a house under the USDA

[@sherrybradshaw6504]

I applied and was granted a $43,000 loan in Missouri. Now I feel like Im on my own now. I know so very little about this program. And whenever I ask questions of workers they either dont know the answer or refer me to someone else that is very unhelpful. They seem to be very busy. Would you direct me to who I could talk to about this problem in Missouri? The more I watch videos about this program the more confused I get. Like I can buy a preowned house, buy land and have a house built, prefab homes?? There are so many question that I need the answers to before talking to builders or prefab companies. When would the owner of the land Im buying get paid? After I build the house? Thank you

[@Rocio36800]

great 👍🏼 video

[@M.Johnson69]

Do you have to pick a property in the same county area that your job is in? Could I pick a property outside of that like in another state or completely different county?

[@butubuta]

Thank you. What about if I leave my job and go to another state and apply for the USDA loan? My job qualification won't work anymore. Please answer my question. I don't get any video on this. What about buying the farmland with the house? What is the difference?

[@MamaThigeresa]

For this loan if purchasing a new condominium or manufactured home, could the price of the land be included in the loan?

[@breezebye7193]

I have a question so my fiancé is trying to get a usda loan however the loan agent is saying he only qualifies for a home that is 200k or under and of course there is nothing in this area at that price range and he makes pretty good money probably just enough to qualify for the limits how do they figure in how much someone can borrow or how much they will lend because this seems wrong to me she is saying its 29% of his income?

[@keithclark8030]

Hey Nicole, I was wondering where I could find the FHA, USDA and VA Underwriters Guidlines? I'm looking to become a loan officer, although there is a lot of information with guidelines, I felt it is very important to learn as much as possible. Yes, I have been looking online, but not sure what is what. I do have the 4000.1 Pdf. Thanks. Edit: Oh Wow! I am in Arkansas as well. Hope you are doing well.

[@crystalmasters8582]

Where is the information though?

[@takeitfromageek6879]

What if you buy land and eventually farm the land? If I bought it and built a house and started making a garden for myself . Then, after awhile decided to sell the extra produce.

[@mohammeddiallo8431]

With score USDA pull, FICO score 8 or FICO score 5,4 & 2.

[@MM-rd4hb]

Can one ask to pay on the principal if one is trying to pay the loan off faster. Say..an additional mortage payment every other month or something like that?

[@Kurtchristauser_w1290]

Hello Miss Nichole how may apply for USDA home no down payment here in Branson Missouri or Springfield Missouri

[@DeannaMaurice]

Great video as always!

[@NicoleNark]

Thank you! I appreciate that

[@riverchaser9175]

Can you use the $15,000 1st time mortgage down payment assistance with the usda direct loan?

[@user-bm4tq2ih8u]

Thank you for your video, great explaining. Our family wants to apply to Single Family Housing Direct Loans in NC. My parents come to us from Ukraine 9 months ago under United for Ukraine program. They working full time and live with us. Can we apply like one household with parents and give their income too? ( like co-applicants)Thank you.

[@MiguelHernandez-lq4sb]

Hi Nicole what bank would you recommend to get a new construction loan 🤔🤔🤔🤔

[@melissacoleman1241]

Would it be possible to use the guaranteed loan to move my trailer home onto a piece of land set up for it?

[@JayyJayyO7]

What’s the Housing ratio and dti limit for manual underwrite ?