Mortgage banker helps buyer qualify for rural housing loan

Mortgage banker: Dave Stambone

Home value: $289,900 Loan amount: $289,900

Loan terms: USDA, 30-year fixed at 4.99 percent, no points

Property type: Single-family house in Sandy Hook

Backstory: A buyer emailed Stambone to discuss low down payment options for a home on which he was anxious to place an offer.

Stambone responded immediately to obtain more information in order to qualify him.

However, the borrower was at work and was unable to speak in private over the phone. To avoid any further delay, Stambone had the borrower complete a web application and apply with his bank securely online.

Upon review of the borrower’s information, Stambone noticed he had fair credit, steady employment, average income and a small amount saved for a down payment and costs to close.

Although not a first-time home buyer, the borrower had only a few options to choose from regarding loan programs.

Stambone and his bank conduct extensive research on the properties clients may be interested in purchasing to determine how to best package a loan. This also helps them avoid any pitfalls or roadblocks during the loan process.

Incidentally, Stambone noticed the address of the subject property fell into a special geographic area in Fairfield County. The borrower and the property qualified for U.S. Department of Agriculture rural housing loan.

USDA loans are one of the least known government mortgage assistance programs and are backed by the department.

The USDA loan’s purpose is to provide affordable homeownership opportunities to low-to-moderate income households to stimulate economic growth in rural and suburban communities throughout the United States.

Furthermore, since USDA loans are guaranteed by the government, homeowners can benefit from low interest rates and discounted mortgage insurance with 100 percent financing. Closing costs maybe financed and paid for through a seller’s concession up to six percent of the sales price.

In order to qualify for a USDA loan, a borrower must have a minimum credit score of 620, a debt-toincome ratio of 50 percent or lower and the property must be located in an eligible area.

Most importantly, the household income (which includes everyone living in the home) must not exceed 115 percent of the area median income.

To his surprise, the borrower was not aware of the USDA program and was attracted to all of the benefits it provided. The loan was the perfect fit and he closed on the purchase in 45 days.

He is now the proud owner of a new home and grateful to Stambone for his strong attention to detail.