Get an Affordable USDA Home Loan in New Hampshire

Buying a home is an exciting milestone, but it can also be daunting, especially when trying to find an affordable mortgage. That’s where USDA home loans can help! USDA offers home loans in rural areas and small towns across America through its Single Family Housing Direct Home Loan program (also known as the Section 502 Direct Loan Program). These government-backed loans have significant benefits that make homeownership attainable if you live in an eligible area in New Hampshire.

Overview of USDA Home Loans

USDA home loans, or Section 502 loans, are available to low- and very low-income homebuyers in rural regions. Eligible towns and small cities in New Hampshire include Berlin, Claremont, Colebrook, Derry, Dover, Exeter, Franklin, Hanover, Keene, Laconia, Lebanon, Littleton, Manchester, Milford, Nashua, Portsmouth, Rochester and many more.

Some key advantages of USDA home loans include:

• No Down Payment Required You can get 100% financing and are not required to make a down payment This makes it easier to buy if you don’t have thousands saved up

• Low Interest Rates: USDA home loans offer fixed interest rates that are very competitive, currently starting at just 4.75% as of June 2024.

• Low Monthly Payments: Subsidies and payment assistance from USDA can significantly reduce your monthly mortgage costs.

• No Mortgage Insurance: You don’t have to pay monthly mortgage insurance with a USDA loan. This saves you hundreds per year.

• Flexible Credit Guidelines USDA has more flexible credit requirements than conventional loans, making it easier to qualify if you have limited credit history

• No Income Limits in Some Areas: In certain higher-cost counties, there are no income caps to get a USDA home loan. Check your eligibility to see if your area qualifies.

• 30+ Year Loan Terms Available: Get an extended 30-38 year repayment term, which keeps payments lower.

• Purchase and Refinance Options: USDA loans can be used to purchase a home or refinance an existing mortgage.

As you can see, there are many reasons why a USDA home loan could be a great fit if you want to buy a house!

Check If You’re Eligible for a USDA Home Loan

While USDA loans offer nice perks, you do have to meet certain eligibility criteria to qualify. Here are some of the key requirements:

• Live in a Rural Area: The home you buy must be located in a rural community, town or small city designated as eligible by USDA. You can check your address on the USDA Eligibility Site. Most of New Hampshire meets this requirement.

• Meet Income Limits: Unless the home is in a high-cost area without caps, total household income must be below the income limits for your county and family size. View income limits here.

• Have a Steady Income: You must have a consistent source of repayable income to prove you can make mortgage payments.

• Have Good Credit: While requirements are flexible, you typically need a minimum 620 FICO score and manageable debt levels to be approved.

• Be a U.S. Citizen: USDA loans are only available for U.S. citizens, non-citizen nationals or qualified aliens.

In addition to the above, you’ll need to demonstrate that you cannot get traditional financing and have enough resources to cover closing costs and fees in order to qualify for a USDA home loan.

How to Apply for a USDA Home Loan

If you meet the eligibility criteria, follow these steps to get started with the application process:

• Complete the Pre-Qualification Form: Fill out USDA’s pre-qualification form online to confirm you meet the basic requirements.

• Find a USDA Lender: Work with a lender approved to offer USDA home loans. This is required to submit a full application.

• Gather Documents: Compile all required documentation including for income, assets, identity, credit and more.

• Submit Your Full Application: Your lender will help you complete the full application and upload supporting documents.

• Get Approved: USDA will review your eligibility and issue a decision on your loan within 30-60 days after underwriting.

• Shop for Homes: Once approved, start looking for a home that fits your budget and needs in your target area.

• Make an Offer: When you find the perfect place, make an offer contingent on financing and appraisal.

• Close on Your Home: Schedule a closing date once the offer is accepted! Bring your down payment (if you have one) and be ready to move in.

It’s smart to get pre-qualified early on so you know your estimated price range when house hunting. Work closely with your lender and real estate agent throughout the process.

What You Can Afford with a USDA Loan in New Hampshire

• USDA loan limits vary by county and are based on 115% of the median home prices in your area.
• In New Hampshire, 2024 loan limits range from around $355,000 to $453,000 depending on the location.
• Higher-cost towns and cities like Hanover and Portsmouth have higher limits up to $453,000.
• More affordable areas like Berlin and Littleton have lower limits around $355,000.
• There are no income limits for properties in New Hampshire counties above $453,000.
• Use the mortgage calculator to estimate your payment. With a 4.75% interest rate, a $400,000 loan would be around $1,830 per month with a 30-year term.
• Payment assistance can reduce the monthly costs significantly depending on your income.
• Work with a lender to get pre-qualified and determine the maximum purchase price you can afford.

Make Owning a Home Attainable with a USDA Loan

Buying a house is a big step, but it’s possible even if you have limited funds or credit challenges. USDA home loans remove many barriers to homeownership by offering specially designed mortgages for rural communities. If you live in an eligible New Hampshire location, see if you qualify and get started on the path to owning your own home today!