USDA loans offer 100% financing and is similar to VA loan as they have a funding fee that is financed on top of the loan. USDA have limits to where they will lend. The USDA loan was developed to promote rural development but homes do not need to be in “rural” areas. In fact only a small percent of Arizona are ineligible for USDA financing. Please see the USDA web site to check the eligibilty of the property you are looking to buy.
USDA Loans offer low fixed rate financing that does not require monthly mortgage insurance. The loan amount is based on the apprised value or sales price, which ever is higher. Buyers commonly get money back at closing because all closing can be paid for by the seller. For buyers who want to put money down, there is no limit to the amount of gift funds or seller paid closing costs.
USDA likes to see credit scores of 640 and above, but is also flexable with underwiting. There are income and asset restrictions. USDA home loans are for buyers who may not qulaify for a conventional types of loan with 20% down payments. USAD home loans are great for areas just outside of cities like Tucson, Sierra Vista and Phoenix. We close many USDA loans in Vail, Safford, Wilcox, Green Valley, and Sahuarita.
If you have had a foreclosure in your past USDA will require 3 years to past from the foreclosure date and a good credit history.