{"id":6656,"date":"2017-09-27T07:50:30","date_gmt":"2017-09-27T11:50:30","guid":{"rendered":"http:\/\/teammovemortgage.com\/?p=6656"},"modified":"2020-07-13T22:28:16","modified_gmt":"2020-07-13T22:28:16","slug":"usda-guarantee-fee-2018","status":"publish","type":"post","link":"https:\/\/teammovemortgage.com\/blog\/usda-guarantee-fee-2018\/","title":{"rendered":"See How the USDA Guarantee Fee Stays Low for 2018 to Help Home Buyers"},"content":{"rendered":"

Homebuyers received great news about the USDA Rural Development guaranteed loan program!\u00a0\u00a0In 2017, USDA<\/a> drastically reduced the\u00a0 guarantee or funding fee they charge upfront on USDA loans, plus lowered the annual fee also.\u00a0 So the great news is that the USDA\u00a0guarantee fee 2018 (also often referred to as a USDA funding fee) will remain at the low 1% financed amount!\u00a0 Additionally the annual fee will remain at .35% which is much lower than FHA’s standard 30 year rate of .85%.\u00a0\u00a0The USDA fiscal year\u00a0stretches from October 1, 2017 – September 30, 2018, so these fees will be effective until 9\/30\/2018.<\/p>\n

Search for USDA Eligible Areas Here<\/a><\/h1>\n

USDA Guarantee Fee 2018<\/h2>\n

\"usda<\/a><\/p>\n

First of all, what is a\u00a0guarantee fee and why should you even care about it?\u00a0\u00a0Guarantee and funding fees are paid directly to lending agencies like VA, FHA<\/a>, or in this case, USDA.\u00a0 Government loans like these require lenders to collect these fees at closing in order to use the programs.\u00a0 This guarantee fee\u00a0actually helps pay for\u00a0the lending agencies and programs to exist.\u00a0 Therefore\u00a0the result is\u00a0these great lending programs, which offer\u00a0low to no down payments,\u00a0are made available to borrowers.<\/p>\n

Luckily for USDA buyers, the USDA\u00a0guarantee fee 2018 is the lowest of the government loans (except disabled Veterans who are exempt from the VA funding fee).\u00a0 Additionally, the USDA\u00a0guarantee fee is financed on top of the base loan amount.\u00a0 So the borrower doesn’t have to bring this fee to closing.\u00a0 Unless of course the buyer wants to.\u00a0 Overall, this means a lower payment and less money brought to the closing table!<\/p>\n

USDA Annual Fee 2018<\/h2>\n

In addition to the upfront guarantee or funding fee,\u00a0the USDA annual fee is also\u00a0going to stay the same as 2017.\u00a0 This amount is .35% of the total loan amount.\u00a0 First of all, a common misconception is that this fee is collected once per year from the borrower.\u00a0 This is not the case.\u00a0 It just means that the monthly figure added to the payment is based on the new loan balance at each anniversary date times the .35% divided by 12 months.<\/p>\n

USDA Income Limits Increase for More Buyer Approvals<\/strong><\/a><\/h2>\n

USDA Annual Fee Calculation Example<\/h2>\n

[av_table purpose=’tabular’ caption=’How to figure the monthly payment using the USDA funding fee and annual fee’ responsive_styling=’avia_responsive_table’] [av_row row_style=”][av_cell col_style=”]Purchase Price[\/av_cell][av_cell col_style=”]$200,000[\/av_cell][\/av_row] [av_row row_style=”][av_cell col_style=”]Base Loan Amt[\/av_cell][av_cell col_style=”]$200,000[\/av_cell][\/av_row] [av_row row_style=”][av_cell col_style=”]Funding Fee[\/av_cell][av_cell col_style=”]$2020[\/av_cell][\/av_row] [av_row row_style=”][av_cell col_style=”]Total Loan Amt[\/av_cell][av_cell col_style=”]$202,020[\/av_cell][\/av_row] [av_row row_style=”][av_cell col_style=”]Annual Fee[\/av_cell][av_cell col_style=”]$707.07[\/av_cell][\/av_row] [av_row row_style=”][av_cell col_style=”]Monthly Amt[\/av_cell][av_cell col_style=”]$58.92[\/av_cell][\/av_row] [\/av_table]<\/p>\n

So in the above example, the purchase price of $200,000 with\u00a0borrowing the full price, the monthly figure added to the mortgage payment is $58.92.\u00a0 To calculate the full monthly mortgage payment, this annual fee\u00a0is added to the principal, interest, insurance, and property tax monthly amounts.\u00a0\u00a0To figure USDA payment scenarios, we\u00a0have a great USDA payment calculator<\/strong><\/a> on our site that you can use.\u00a0\u00a0We always\u00a0welcome you to contact one of our loan officers too.\u00a0 Our USDA experts can help walk you through the USDA process including payments, costs, and more.<\/p>\n

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\nCheck payments for your purchase price here
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USDA No money down home loans are one of the best deals out there!\u00a0 Plus borrowers are not required to be a first time buyer, but you can be!\u00a0 USDA benefits include…<\/p>\n