As we have reported here in previous articles the USDA is running out of funds for the fiscal year 2010. The announcement today that the USDA will issue conditional commitments for Section 502 Single Family Housing Guaranteed Loans after the funds have been exhausted is potential good news for home buyers in Pierce County or anywhere that it is possible to use USDA financing. Your USDA approved lender can continue to process completed loan requests, receive conditional commitments, and close loans.

There is a change to the USDA financing the “Guarantee Fee” is increasing to 3.5% for purchase loan and it is increasing to 2.25 for refinance loans. The cost of getting a USDA loan has just increased. The borrower can still put zero down but will have the guarantee fee wrapped into the total loan. In a very simple example if you were to buy a 100,000$ home the initial loan amount would be 103,500$

While the cost of borrowing money using USDA financing has gone up the news that funds will continue to be available is good news for home buyers. When you are ready to begin looking for your home we hope you will give us a call so we can help you through the process of making a great decision. We work with multiple approved USDA lenders and we can help match you with a lender who will work hard for you to get the best possible financing. We then will work hard for you to find the best home and the best deal. We’re here when you’re ready.