Yes, USDA loans require mortgage insurance. There is an upfront guarantee fee, which can be financed into the loan, and an annual fee that is paid monthly. However, these costs are generally lower than the mortgage insurance premiums for FHA and conventional loans with low down payments.
Buying a Fixer-Upper? USDA Loans May Not Be the Right Fit
USDA loans are designed for move-in-ready homes. If you’re thinking about purchasing a fixer-upper or a property that needs significant work, this loan type may not be ideal. That said, the USDA does offer separate programs—such as the Section 504 Home Repair loan—for eligible homeowners who want to make limited improvements or repairs.
How Long Does it Take to Get a USDA Loan Approval?
While the timeline to close on a USDA loan can be similar to conventional loans, it often takes a bit longer due to an additional approval step by the USDA itself. After your lender completes underwriting, the loan must also be reviewed and signed off by the USDA, which adds a few extra days to the timeline. Typically, you can expect the process to take between 30 and 45 days, depending on your location and how quickly documents are submitted.
Contact PDCU to Learn More About USDA Loans
If you think a USDA loan might be right for you, contact our loan specialist to learn more. We also have a variety of other mortgage products that might meet your needs. People Driven Credit Union is here for you for every step of your home ownership journey.
