usda loans

FHA loan products have an "Arms Length" transaction clause in them.. Meaning if you are selling to a relative, they will only lend up to a certain percentage which for FHA, it's 85%, for USDA they do allow Non Arms Length transactions, however lender overlays might have additional restrictions such as a lower Loan to Value.. if you want to know for sure,, you should contact a LOCAL mortgage broker, not the local "Big" bank, and certainly not one of those 50 states internet lenders...By applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with numerous lenders, seeking out the best loan terms for your particular scenario. Because he has lower overhead, he can offer you lower rates and lower fees than most of the larger lenders.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

You will not be able to use USDA for this transaction. Buying from a family member is known as a non-arms-length transaction and is subject to stricter guidelines, sorry. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com 888-889-9950

I agree with William. Your best bet is to find a local mortgage broker to help you. They will have many more resources then your local bank. Good luck.

Indiana USDA RD has nothing noted in the lender's handbook that would prohibit the sale; however, you must remember that USDA only guarantees the loan and does not actually provide the funds. It is the actual banks/investors who might have issue with non-arms length purchase transaction.

it doesn't is the answer, but you have to contact a mortgage specialist in your state to find out if they have additional restrictions or "overlays". I thought that USDA does not have the arms length clause as opposed to FHA.