06/20/2025
Did you know that a Rural Development loan(aka USDA) is the only conforming loan program that allows 100% financing based on the appraised value? Do you know what 100% financing means? Probably not, but that's OK!
100% financing means there is a zero down option. USDA takes it one step further and allows this to be based off the appraised value while other programs base it off the lower of the purchase price or appraised value. So if the house appraises above the purchase price, you may be able to roll closing costs into the loan. You are still subjust to falling within the proper debt to income ratios though so this is determined case by case.
Why is this important? In the ever increasing cost of living, closing costs can be a toll, especially on first time buyers who don't have funds coming from the sale of a property. Having the option to finance an extra few thousand dollars into the purchase could mean the difference between buying now or waiting till later while housing prices continue to rise.
