Big Changes are coming to Rural Development October 1st 2016.
Rural Development Mike Archer and I get together to talk about them in this interview.
Dave: I wanted to talk about the changes coming up next week with the Rural Development loans, can you tell us a little bit about RT loans?
Mike: Absolutely! A Rural Development loan is one of our favorite products here in Jackson. We are rural community and RD is designed for people purchasing homes this type of community. It is a fantastic product. It’s a 0% down; interest rates are fantastic. They do charge funding fees which were going to talk about in a minute. They do not have Private Mortgage Insurance but they do have a monthly guarantee fee, but no PMI.
Dave: So zero down?
Mike: Zero down.
Dave: A lot of people think that it has to do with farms.
Mike: Actually we cannot do farms on this product. With RD loans anything income producing does not qualify. It’s designed for people purchasing a home, a single-family residence within a rural area.
Dave: It’s really based on where the home falls on the map that USDA designates?
Mike: Exactly there’s a map, that will be linked below, so just plug in your property address and it tells you if you’re eligible, it very simple.
Dave: Mortgage 1 is one of the largest providers of that type of loan in Michigan?
Mike: We are a market leader in the RT lending which were all very proud of.
Dave: Mike could you talk a little bit about the changes that are coming up for October.
Mike: October first we have huge changes in the RD funding fee. Rural Development charges an upfront funding fee very similar to a VA loan for people that know what a VA loan is like. RD charges a funding fee of 2.75 percent which is financed into the loan. That fee is dropping from 2.75 to one percent.
Dave: That’s a huge savings.
Mike: On $150,000 loan that’s a savings of about $2,600 dollars.
Dave: That’s a lot of money!
Mike: Also, the monthly guarantee fee is dropping from .50 Percent to .35 which is a savings of about ninety dollars a month.
Dave: On that hundred fifty thousand loan?
Dave: That’s not a lot, but it’s something and Mortgage Rates are so low right now.
Mike: Rates are fantastic right now, again near historic lows, and who know where rates are going. It’s a tremendous time to take advantage of this product especially.
Dave: We have branches all over Michigan but if they want to reach you directly here in Jackson, how would they go about doing that?
Mike: In Jackson we have an awesome website its www.mortgage1jackson.com or our phone number here 517-315-4626.
So Fannie and consumers are forced to use a FICO® score that is over ten years old. Hopefully we will get some changes shortly and when we do it will be the biggest change in the credit industry over the last twenty years.
Trended Credit Data unintended consequences.
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