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New Loan Programs Available from Aligned Mortgage

FHA and usda loan programs at aligned mortgage

Our dedicated team at Aligned Mortgage considers it a privilege and an honor to serve our Veteran and military community. Taking care of those who have and continue to protect us selflessly is what we do best. For nearly 20 years, Tony Dias and his team have made it possible for countless Veterans and their families to purchase homes of their own.

With a steadily rising cost of living, soaring real estate prices that aren’t forecasted to drop anytime soon, and a lack of affordable housing inventory, it isn’t difficult to imagine military families worried over the notion of not being able to acquire their fair share of the American dream of homeownership. At Aligned Mortgage, we strive to remove that burden from our military members and work toward keeping our families together so that they can grow and prosper in their communities. 

We’re aware that, often, buying a home involves some level of frustration. Many Veterans can identify with this all-too-familiar scene. You’re ready to buy a home of your own, and you earn enough to afford the monthly mortgage payments, but you’re finding it impossible to come up with the funds for that sizeable down payment. In other words, you’re not able to buy the home you can technically afford. 

And, so, the search for answers begins. Are there any other low or no-down-payment options available for you and others in this unfortunate predicament? Where can potential homebuyers find another government-backed loan program similar to the VA home loan benefit? Look no further because Aligned Mortgage has the solutions.

First, you should know that at Aligned Mortgage, we believe the VA Loan program is, hands down, the best all-around loan option available for our Veterans and active military. VA loans don’t require down payments or monthly mortgage insurance and offer low interest rates. But we are also aware that Veterans and military families make up a diverse community where one-size-fits-all is not always the norm. With that in mind, Aligned Mortgage proudly announces the latest offering of two additional government-insured loan programs — U.S. Department of Agriculture (USDA) and the Federal Housing Administration (FHA). Both USDA and FHA loans provide excellent affordable options for low-income civilians using a government-approved loan program. As with VA loans, FHA and USDA loans offer low interest rates, lower credit score requirements, minimal monthly mortgage insurance premiums, and require little to no down payments

 

What is a USDA loan?

Not every homebuyer is suited to city life or a planned development. The USDA loan program is ideal for the person who feels more at home gazing across rolling fields from the front porch rather than winding stretches of sidewalks and driveways. If you’re that potential homebuyer, you might consider the USDA Rural Development Guaranteed Housing Loan Program, one of the lesser-known mortgage assistance options made available by the U.S. Department of Agriculture mortgage program. High-quality, affordable housing is an essential factor in promoting robust communities in rural America. USDA home loans offer zero down payment mortgages to eligible families who want to live in these less congested surroundings. The loan program is designed to improve the economy and quality of life in rural America. With that in mind, homebuyers should note that they must look at homes within USDA-eligible geographic areas, meaning qualified rural areas defined as a population of less than 20,000 by the USDA. But the benefits of a USDA loan far outweigh any limitations when you consider that, along with competitive interest rates and lower credit score requirements, there are no maximum loan amounts, and there’s a low monthly mortgage insurance premium in the form of an annual fee. The loan isn’t limited to first-time homebuyers and can be used more than once, although a buyer may only have one USDA loan at a time. 

Qualifying for a USDA loan

For many potential homeowners who are just starting out, finding a home loan program that allows them to get into a house with little or no money down while still offering low interest rates gives them a significant advantage. However, applicants must meet specific requirements set up by the USDA to qualify. They include:

  • USDA-guaranteed home loans only fund owner-occupied primary residences. No rental properties or vacation homes allowed.
  • U.S citizenship or proof of permanent residency status
  • The buyer must meet USDA monthly income caps and can’t make more than 15 percent above the local median income.
  • The buyer must meet USDA’s ability to repay standards that include dependable income, FICO score of 640 or higher (varies by lender), and a debt-to-income ratio of 41 percent or less. Note that the USDA will often consider a higher debt ratio if your FICO score is 680 or above. 
 

fha loan programs

  • The FHA loan program is another government-backed home loan we’re now offering at Aligned Mortgage to better serve our borrowers by providing them more lending options, which often translates to better buying power. There are similarities between the FHA Loan program and the USDA loan program. The combination of low interest rates, low down payment, low monthly mortgage insurance, and a lower credit score requirement make the FHA loan appealing to potential buyers.

FHA loans are originated only by FHA-approved lenders and insured by the Federal Housing Administration. Borrowers can use FHA home loans to purchase or refinance single-family houses, two-to four-unit multifamily homes, condominiums, and some manufactured and mobile homes. Specific types of FHA loans can also be used for new construction or for renovating an existing home.

One FHA loan perk that allows buyers to get into a home with little to no money down is through the FHA down payment gift fund. A condition of FHA loan approval asks the borrower to provide a minimum down payment of 3.5 percent. But suppose, as the borrower, you don’t happen to have that kind of money lying around. Do you lose the deal on your family’s new home? Absolutely not because the FHA allows you to accept a monetary gift to put toward the purchase of your home. This type of gift provides a thoughtful way to help a first-time borrower with limited funds purchase a home. Naturally, there are stipulations. Here’s how it works:

Who Can Gift Funds?

  • A relative
  • A close friend
  • Your employer or labor union
  • A charitable organization without tax-exempt status
  • A government agency or public entity with a program providing homeownership assistance to low- and moderate-income families or first-time home buyers.

 Who cannot gift the funds?

  • The seller
  • The real estate agent or broker
  • The lender
  • The builder
  • Any associated entity related to the real estate transaction
As you can see, the FHA gift funds donor may not be a person or entity with an interest in the sale of the property.
 

How does a donor go about gifting FHA funds?

The donor wishing to fund your FHA down payment gift simply writes a brief gift letter stating that they want to give an amount to be used toward the home’s down payment and/or closing costs. It’s important to say in the letter that no repayment is required because the mortgage lender has to verify that the funds were not obtained through any sort of loan, which would make it an additional debt obligation. The donor then gives you the gift amount to be deposited into your bank account. You can download templates for gift letters online or get them from your lender. 
 

Would you like to learn more about the USDA, FHA, or VA home loan benefit?

Aligned Mortgage has a team of experienced loan officers eager to help you understand which loan program would best suit your needs. Get started below or Contact us today at 210.866.6900

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