Find Out if a USDA Loan in California Is the Right Choice


Find Out if a USDA Loan Is the Right Choice for You

Fixed-rate USDA loans offer many benefits for homebuyers in the Sacramento area. Learn more about these unique loans or contact us today to apply.

Escape the Hustle and Bustle

Are you dreaming of a new home in a quiet, rural area with more space to enjoy nature or play with the kids? Do you have decent credit but a smaller down payment? A USDA loan might be an excellent fit for your family.

A USDA loan is a type of fixed-rate loan backed by the United States Department of Agriculture and is available to families interested in moving to rural areas. Continue reading to learn more about USDA loans, or give us a call today to speak with one of our expert mortgages advisors at United Wholesale Lending. We are here to help you get pre-qualified, so you can begin searching for your next home.

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What Is a USDA Home Loan?

USDA loans are part of the USDA Rural Development Guaranteed Housing Loan Program. This program was designed to make properties in rural areas more accessible to homebuyers with modest incomes.

The USDA guarantees these loans, which means if a homeowner ends up defaulting on their loan, the USDA steps up. Because this reduces the risk to lenders, it may make it easier for you to get a mortgage if you meet the qualifications.

Since it was established, it has helped more than 1.5 million homeowners get loans for homes in rural areas, according to the USDA.

Who Are USDA Loans For?

USDA home loans are ideal for certain applicants that would benefit from a government-backed loan but do not qualify for an FHA loan because they are not first-time homeowners. This may be due to a modest income or a small down payment.

First-time homeowners are also eligible for a USDA loan but may decide that an FHA loan is more suited to their needs. USDA home loans are not for those looking to purchase a large or commercial farm, as they are only for properties up to eight acres.

What Are the USDA Loan Requirements?

There are specific requirements you must meet to be eligible for a USDA loan, and there are some restrictions to the type of property you can purchase. However, if you are looking for a residential property in a rural area and have decent credit, they can be an excellent choice. Requirements include:

  • A credit score of above 620 for most lenders
  • The property must be less than eight acres
  • The property can not have a pool
  • Must be located in a rural area or town, generally areas with less than 20,000 people
  • Applicants must have a household income of less than 115% of the median income in the United States (this is approximately $65,000 for a family of four.)

What Are the Benefits of a USDA Loan?

USDA loans can help make homeownership accessible to more families. In some cases, you may qualify for 100% financing, with no down payment required. Some of the additional benefits include:

  • No cash reserves required
  • No loan limits
  • You are not required to be a first-time buyer
  • Your mortgage is backed by the government, making it easier for lenders to approve your application.
  • These loans are fixed-rate so that you can lock in a low rate for the length of the loan

What Are the Limitations of a USDA Loan in California?

While USDA loans are an excellent choice for many, there are some drawbacks to choosing a USDA home loan. You are restricted to purchasing a house in a rural area, and there are income limits, meaning you may not qualify.

Additionally, because USDA home loans are for properties under eight acres, they aren’t suitable for large farms. At United Wholesale Lending, we can help you determine if this type of loan makes sense or help you learn more about alternative financing options.

How to get a USDA loan in Sacramento

Check out our easy 3-step process here.

Step 1: Get Informed

There are dozens of different loan options out there, but don’t worry. We’ll walk you through each one so you can feel confident in your decision.

Step 2: Apply for Your Loan

Once you are comfortable with your choice, we’ll help you collect everything you need to successfully apply for your loan so it is done properly and there are no delays.

Step 3: Start House Hunting

Once you are preapproved for your mortgage, you can begin looking for your new home right away. Give us a call today to get started!

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Work With a Trusted Mortgage Broker

At United Wholesale Lending, we have been guiding potential homeowners through the mortgage process for years. See why our customers trust us with the biggest financial decisions of their lives.

Experienced Independent Brokers

We are not a financial institution. We are a team of independent brokers who put your needs first. We work with all the top lenders in the industry to ensure that you are being treated fairly.

The Best Possible Rates

Interest rates are at or near historic lows, but if you go through a financial institution, you could still end up paying more than you should. When you choose an independent broker, we work with many lenders to compare rates and ensure that you are getting the lowest one.

Creative Lending Solutions

Getting a mortgage is not a one-size-fits-all process, and not every loan is suitable for every family. We offer a wide range of mortgage options and will be happy to walk you through them. This gives you the best chance of being approved while choosing a mortgage that you can comfortably afford.

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Schedule a Free Mortgage Consultation Today

If you are interested in buying a new home in Sacramento or the surrounding areas, we are here to help. Contact United Wholesale Lending today to determine if a USDA loan in California is right for you or learn more about all the other loans we offer.

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