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SIH - Mortgage lending > USDA > Flashcards

USDA Flashcards

1
Q

What does GUS stand for?

A

Guaranteed Underwriting System

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2
Q

What does AN stand for?

A

Administrative Notice

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3
Q

What can the appraised value be used for?

A

If the appraised value is higher than the purchase price, the difference may be used to offset the closing cost

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4
Q

Can the One Time Guarantee Fee be financed?

A

Yes, and may exceed 100% LTV by the amount of the one time guarantee fee.

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5
Q

What is the maximum purchase price under USDA?

A

There is none

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6
Q

Is there mortgage insurance with USDA?

A

No

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7
Q

What is the required DTIs for USDA?

A

29 for housing and 41% for total debt

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8
Q

Can the DTI’s be exceeded?

A

Yes, with a debt ratio waiver request approved by USDA

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9
Q

What amortizations are allowed under USDA?

A

30 years only

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10
Q

Are there reserve requirements with USDA?

A

no

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11
Q

Are borrowers required to have a checking or savings account?

A

No

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12
Q

Is there an upper asset limit that the borrower may have?

A

no, however, income from assets will be considered in the income eligibility requirement

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13
Q

What is the minimum FICO score for USDA?

A

there is none, however there will be an overlay with the lender

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14
Q

Is non-traditional credit allowed?

A

yes, however, see individual investor overlays

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15
Q

are downpayment assistance, MCCs, and buydowns allowed under USDA?

A

yes

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16
Q

is USDA limited to first time home buyers?

A

no, one may currently own other property

17
Q

can the borrower be a property owner and still qualify for USDA?

A

yes

18
Q

What percentage of the loan amount of a USDA loan is guaranteed to the lender

A

90% of the loan balance

19
Q

what HUD handbooks are used to determine eligible properties?

A

HUD 4150.2 and 4905.1

20
Q

Are condos allowed under USDA?

A 
Yes, as long as the condo is approved by ONE of the following:
Fannie Mae
Freddie Mac
HUD
VA
21
Q

Are PUDs allowed under USDA?

A

Yes, all attached or detached PUDs are allowed

22
Q

Are modular homes eligible under USDA?

A

yes, provided that they meet either new construction requirements of USDA or if re-sale, the HUD 4150.2 and 4905.1 requirements

23
Q

Is new construction allowed for USDA?

A

yes, the take out loan can be USDA (not the construction loan itself)

24
Q

Are manufactured homes eligible under USDA?

A

yes, only under SPECIFIC circumstances (check guidelines)

  • new: must be dated within 1 year of construction and the builder must be approved by USDA
  • re-sale: must be originally built and financed with a USDA loan and it must be the original owner as the seller
25
Q

is investment property allowed under USDA?

A

no

26
Q

are second homes allowed under USDA?

A

no

27
Q

What type of borrower occupancy is allowed under USDA?

A

owner occupied only

28
Q

are farms or business properties allowed under USDA?

A

no, and a residential property must not have any income producing type structures on the property such as horse stables, cell phone towers, etc

29
Q

how many acres may be financed with USDA?

A

There are specific guidelines for this but generally as long as not more than 30% of the value of the property is derived from the acreage, then the property should qualify

30
Q

are homes with swimming pools eligible under USDA?

A

yes, they are eligible, however, the appraiser should determine the value of the swimming pool (if any) and subtract it from the value of the property for financing purposes. Only the value of the property minus the pool may be financed with a USDA loan.

31
Q

What three factors determine eligibility for USDA program?

A
  1. Property: property must be eligible
  2. Area: is the property within an eligible area
  3. Income: does the household income meet the eligible requirements
32
Q

What factors affect income eligibility under USDA?

A
  1. county
  2. number of people in the household
  3. number of dependents
  4. if loan applicant is 62 year or older
  5. if there are any disabled persons living in the home
  6. Expenses and deductions for child care, medical or disability (if disabled or older than 62)
  7. of course, income amount
33
Q

What four questions are on the Household Members information section?

A
  1. number in the household (excluding foster childred)
  2. number under the age of 18, disabled person, full time students (not including the applicant or spouse)
  3. is the applicant 62 year or older?
  4. are there any disabled persons living in the household?
34
Q

What is needed to prove annual child care expenses?

A

documentation, tax returns, etc. This does not count against DTI calculation and child support payments and/or tuition cannot be included in this amount

35
Q

Do annual medical and/or disability expenses count against DTI?

A

No

SIH - Mortgage lending (3 decks)

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