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Residential Mortgage Loans
What are the middle score requirements for usda and conventional, to keep manual underwriting from occurring? What kind of reserves will each require? Without down payment added, how much will closing costs be on a 200k home? Is it possible to get into a home via usda and never pay anything? Do you offer down payment assistance in Kansas? Sorry for the wall of questions.
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1 Reply
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Middle Score Requirements:
USDA Loans: To avoid manual underwriting, USDA loans usually require a middle score of 620 FICO. USDA does not have a minimum credit score. Normally, any credit score under 620 requires a manual underwrite.
Conventional Loans: They require a higher middle score of 620 to avoid manual underwriting. You normally cannot do a manual underwrite on conventional loans.
Reserves Required:
USDA Loans: USDA loans do not require any reserves, but they can help strengthen your application if you have them.
Conventional Loans: Depending on your financial profile, you may be required to have 2-6 months reserves.
Closing Costs on a $200K Home:
Without a down payment, closing costs are typically 2%—5% of the loan amount. So, expect $4k—$10k.
USDA Loan with No Out-of-Pocket Costs:
If the seller pays for closing costs or you qualify for grants/assistance programs, you can get into a home with a USDA loan and pay nothing out-of-pocket!
Down Payment Assistance in Kansas:
Some down payment assistance programs may be available through state or local housing agencies. Please contact us at Gustan Cho Associates for more information, as availability and eligibility vary!
Please let me know if you would like more details on anything specific.