USDA loan when selling a house

USDA offers 2 types of home loans. One is thru an approved mortgage lender (bank, credit union) and the other is borrowed directly from USDA.

Usually the wait time depends on how backed up the guarantee process is. Here in MI it's typically 2-3 weeks in addition to the lender's time. So a total of 6-7 weeks.

The home loan package is sent off to the USDA office typically in your state's capital. A real human underwriter reviews the package and issues the "guarantee" to the loan and to the borrower.

I wouldn't worry. The process is more tedious but most people are pre-approved when they begin the process so there are few surprises along the way.

They're common here in rural areas. Their rates and terms are better than an FHA or VA backed loan.

This house is in N.C. and the buyer is pre approved and the appraisal went through. She is getting a USDA loan direct.

So it could be up to 6-7 more weeks now before we hear anything from the USDA?

What does USDA stand for?

On 10/24/2014 happy housewife said:

What does USDA stand for?

US Department of Agriculture. It is rural area loans for low income buyers 100% loan.

You don't have to be low income. That's limited to the Direct Program. You can have higher income and borrow thru your bank or credit union.

If she's going Direct then she's already been preapproved, documents, credit reports, job and bank verification, etc.

If the appraisal and inspection are completed then it's off to the state office for approval. I think you're looking at a couple of weeks at most.

If you have a real estate agent you've listed with, did you ask them about a time frame?

On 10/24/2014 Snowpuppy said:

You don't have to be low income. That's limited to the Direct Program. You can have higher income and borrow thru your bank or credit union.

If she's going Direct then she's already been preapproved, documents, credit reports, job and bank verification, etc.

If the appraisal and inspection are completed then it's off to the state office for approval. I think you're looking at a couple of weeks at most.

If you have a real estate agent you've listed with, did you ask them about a time frame?

Neither agent has ever had a purchase with this kind of loan so they are saying 1 to 40 days.

I had no idea anyone could get this loan.

On 10/24/2014 golfcartrider said:

On 10/24/2014 Snowpuppy said:

You don't have to be low income. That's limited to the Direct Program. You can have higher income and borrow thru your bank or credit union.

If she's going Direct then she's already been preapproved, documents, credit reports, job and bank verification, etc.

If the appraisal and inspection are completed then it's off to the state office for approval. I think you're looking at a couple of weeks at most.

If you have a real estate agent you've listed with, did you ask them about a time frame?

Neither agent has ever had a purchase with this kind of loan so they are saying 1 to 40 days.

I had no idea anyone could get this loan.

40 days is about 6 weeks so I don't think that's really too long in today's lending. Everyone is cautious. Conventional you can close in 30 days. IF you're lucky.

Not sure what you mean by "this loan"? You do have to have a good credit score, meet DTI ratios and tho it's a 0 downpayment you do need closing costs.

Your lazy agent can place a call to your local office and tell you how long it can take to close.