The ZERO DOWN HOME LOAN  

Also, loans made possible by partnerships between RD and approved lenders improve the economic health of communities. The continued well-being of rural areas provides more opportunities for lending institutions that invest in these communities. 

Don't be fooled by the word "rural" in the name.  There are thousands of towns eligible.  It is only the metropolitan areas that are in-elligible for this great program. 

PROGRAM HIGHLIGHTS

• No down payment. Provides 100% loan-to-value financing for existing homes based on appraised value
• Homes must meet Minimum Home Requirements
• Unlimited closing Costs may be financed into the loan amount or if paid by the seller up to a maximum of 6% of the property's purchase price
• One time guarantee fee of 2.0% of the loan amount, payable to Rural Development (RD) at closing, This fee can be rolled into the amout borrowed. Also, in most cases, this fee is also tax deductible.
• As of 10-1-11 an Annual Fee - paid monthly of .30% of the unpaid balance. 
• Fully amortized 30-year fixed rate loan
• Less up-front cash-to-close requirements for this program than for conventionally insured or FHA loans.
• No pre-payment penalty for paying off your mortgage early
• Taxes and homeowners insurance included in your monthly payment

BORROWER ELIGIBILITY REQUIREMENTS

• Do not own an adequate dwelling.
• Borrowers' adjusted household income cannot exceed the maximum allowable income limit per County. **Click here for Michigan Income Limits
• Have the legal capacity to incur the loan obligation.
• Will be the owner occupant.
• CREDIT - Have acceptable credit history or middle credit score over 620.

  Allowed one 30 day late payment within the last 12 months credit history or within the last 36 months rental history.

  A bankruptcy must be discharged at least 36 months. Re-established good credit history.

  Collections or judgments must be paid in full.

• Have adequate and dependable available income.

  PITI (Principal, Interest, Taxes, Insurance) not to exceed 29% of gross monthly income.

  Total debt payments not to exceed 41% of gross monthly income.

ELIGIBLE AREAS

Homes must be located in areas which include open country or communities having a population not in excess of 10,000 or not in excess of 25,000 provided it is not part of a Metropolitan Statistical Area. Click link to check to see if property is in an elligible area.    Eligible Areas