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Can we qualify for Rural Development Mortgage Loan

Posted on: 25th May, 2009 08:43 pm
My husband's credit score finally made it to a 620 but mine is still below that at a 582. We have been preapproved for an FHA loan with an approve/ eligible and have a contract on a home. Our mortgage broker decided to try for the Rural Development with just him on the loan since my husband's score went up and the terms would be much better. His debt to income would be over 41% with just him on the loan. Will Rural Development look at DTI ratios over 41%? We meet all the other qualifications. Thank you!

The DTI requirements for an USDA rural development loan is 41%. They do not usually offer loans to borrowers with more than 41% debt to income ratio. There are exceptions though, where loans are offered to those having a more than 41% DTI. But in that case, the borrowers credit score and payment history has to be so good as to compensate for the high DTI. Since your husband has a not-so-impressive credit score of 620, it may be difficult for him to qualify for an FHA or a rural development loan with a high DTI ratio.
Posted on: 26th May, 2009 05:24 am
it is my understanding that most lenders will be on the liberal side of the coin when trying to approve loans, so that seems to indicate you're in good shape, regardless of which side of 41% he falls on.
Posted on: 26th May, 2009 08:25 am
We just found out today that we were turned down for the RD because of derogatory credit since a bankruptcy which was discharged over 5 years ago. There were a couple of late payments on my husbands credit report due to his layoff last year but he has a 620 score now. So we are back to trying for FHA. We got an approve/eligible for FHA so we hope that one works out.
Posted on: 27th May, 2009 04:36 pm
Hi, My name is Mr TONY BENSON. I am a private lender who give out
loan to private and corporate individuals. Have you been turned down
by so many banks? Do you need finance to establish your business? Do
you need finance for the expansion of you business? Or do you need a
personal loan? My loan ranges from personal to business loan. My
interest rate is very affordable and our loan process is very fast as well.

[Promotional text deleted as per forum rules. Thanks.]
Posted on: 28th May, 2009 12:47 am
Hi Tony,

This is totally a promotional post. I would like to inform you that promotional posts are against the forum rules and guidelines. I think the moderators of the forum would delete it. This is just an advice. I hope you don't take it otherwise.

Take care.
Posted on: 28th May, 2009 02:56 am
thanks, sara.
Posted on: 28th May, 2009 10:30 am for more information's on your loans
Posted on: 29th May, 2009 12:00 am
tony, you have been warned not to advertise like that. if you want to be a member of the community, it would expected, and it would be nice if you would act according to the guidelines posted.
Posted on: 29th May, 2009 07:49 am
hi pwd,

with a credit score of 620, it is possible for your husband to get an fha loan. you can get an fha loan 2-3 years after a chapter 7 bankruptcy. the bankruptcy you have on your credit is 5 years old. so this is not going to affect your eligibility. the late payments were due to the layoff. an explanation letter stating the reason for the late payments should be enough to convince the underwriter that the late payments were due to the financial hardships resulting from the layoff. thus, i believe your husband does have a chance of getting an fha loan.
Posted on: 31st May, 2009 10:00 pm
Thank you for all of your posts. We got a final approval today and are supposed to close on Friday with an FHA loan at 5.5%. We are so excited!
Posted on: 09th Jun, 2009 05:13 pm
Hi pwd,

Congratulations. :)

So, you've finally been approved for an FHA mortgage. The interest rate is also quite good. It looks like you've got a good deal.

However, in my opinion, it will be worth your while to have an attorney represent you at the closing, to make sure things are done properly and no issues arise from it in future.


Posted on: 11th Jun, 2009 04:42 am
Well i was told bc my credit score was over 620 i would get the approval for RD however when it went through the overwriting approvel i was denied due to to my income is insufficient to sustain payments for the type and amount of credit requested. Do anyone have any idea what that means???? :?
Posted on: 12th Nov, 2009 08:25 pm
It means your DTI (Debt to Income) probably exceeds the 41%. Meaning that after they add in your mortgage, tax, etc. along with your current bills, car payments, credit cards, it makes you unable to qualify for the amount of the loan.
Posted on: 13th Nov, 2009 06:46 pm
Well thanks svromeo00 for explaining to me! After trying everything possible i found a company who was willing to help me and we got approved for our home! Just waiting on my land appraisal! :D
Posted on: 27th Nov, 2009 05:53 pm
I have a middle credit score of 669. I am trying for a Rural Development Loan and have a concern about a couple of late payments. While i have always paid my credit accounts on time or early and have paid off some debt recently, there were a couple times when i paid a utility bill late. Do they look at that or just credit accounts that are regularly reported to credit bureous?
Posted on: 31st Dec, 2010 09:20 pm
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