USDA Loans

Question 1

The USDA loan guarantee is what percent of the amount owed in the event of a borrower default?

Answer 1

90% of the outstanding debt

Question 2

RHS is a part of the USDA. What does RHS stand for?

Answer 2

Rural Housing Service

Question 3

What does RHS address?

Answer 3

Section 502 of the Housing Act of 1949

Question 4

What underwriting system do USDA loans use?

Answer 4

USDA loans use an automatic underwriting system (AUS) called GUS or Guaranteed Underwriting System

Question 5

Unlike FHA and VA, RHS lends ________ to borrowers and ________ loans that meet RHS program requirements made by approved lenders.

Answer 5

directly; guarantees

Question 6

What are the qualifying ratios for USDA loans?

Answer 6

29% housing expense ratio or front-end ratio; 41% DTI or back-end ratio

Question 7

For USDA loans, rural can include towns up to _____ people.

Answer 7

35,000

Question 8

There is no _____ required for USDA?

Answer 8

No down payment, no minimum credit score, no reserves required, no maximum purchase price, no seller contribution limits,

Question 9

What type of borrower does USDA loan support?

Answer 9

Limited income borrowers and offers 100% financing

Question 10

For USDA loans, Are there any upfront or annual fees?

Answer 10

Yes, the upfront and annual guarantee fees are non-refundable.