USDA Announces Funding Fee Changes Effective 10/1/2015

USDA announces increase in the USDA guarantee or funding fee effective 10/1/2015 to 2.75%

USDA announces increase in the USDA guarantee or funding fee effective 10/1/2015 to 2.75%

For buyers, USDA mortgage loans are so popular (especially in NC, SC, and Virginia) because they allow first time or subsequent homebuyers to purchase a primary residence with no money down and with low monthly payments.

The USDA National Office just announced on June 16, 2015 that effective with guaranteed loan obligations on or after October 1, 2015 through September 30, 2016, the up-front USDA guarantee fee is increasing from 2.0% to 2.75%.

This USDA up-front fee is financed on top of the base loan size just as it is done for VA and FHA loans so the change does not require the buyer to bring additional money to closing but it will make their payment a few dollars more per month.  The Annual Fee will remain at .50% which is factored into the monthly payment.  If you are looking to purchase soon & would use a USDA loan, let’s get the USDA commitment prior to October 1!  Learn how the USDA Annual Fee is a little different from traditional PMI here.

The Up-Front USDA guarantee fee increase does also apply to USDA Streamline or Pilot Refinances.

The official USDA Rural Development unnumbered letter dated 6/16/2015 “Upfront Guarantee Fee and Annual Fee Schedule Effective October 1, 2015” can be read here and is available under “June 2015” on this page.  Keep in mind that a loan is obligated when the mortgage lender has fully underwritten the file, USDA has approved a complete loan package, and USDA has issued form RD 3555-18 which is the “Conditional Commitment for Single Family Housing Loan Guarantee” to the lender.

Team Move lends in areas such as Wilmington, Leland, Hampstead, Jacksonville, Camp Lejeune, Whiteville, Shallotte, Southport, Elizabethtown, Lumberton, Fort Bragg, Pope Air Force Base, Fayetteville, Rockingham, Raleigh, Garner, Smithfield, Clayton, Goldsboro, Charlotte, Greensboro, Winston-Salem, Durham, Chapel Hill, Burgaw, Castle Hayne, Holden Beach, Supply, Ocean Isle Beach, Sunset Beach, Hubert, Tabor City, Carolina Beach, Kure Beach, Laurinburg, Topsail Beach, North Topsail Beach, Surf City, Sneads Ferry, Richlands, Wrightsville Beach, New Bern, Oak Island, Saint James, Wallace, Sanford, Pittsboro, Apex, Cary, Raleigh, Holly Springs, Fuquay Varina, Siler City, Southern Pines, Aberdeen, Pinehurst, Whispering Pines, Vass, Spring Lake, Fayetteville, Lillington, Hope Mills, Dunn, Angier, Smithfield, as well as the rest of NC.  North Myrtle Beach, Myrtle Beach, Conway, Loris, Little River, Longs, as well as the rest of South Carolina and Virginia.

 

Author: Russell Smith

Team Move OVM Financial loan officer success is Russell’s primary focus. He provides the tools and techniques he used as a top producing loan officer. Additionally he offers the Team Move OVM Financial Agent Training Program. Sharing is so important to Russell so he works diligently to be a resource to loan originators and Realtors.