I recently had two clients call me looking for 100 percent purchase loans. I work so much in the Milwaukee, Waukesha and Madison area that I forget about a little used Rural housing 100 percent loan program. You can qualify under this program with very little out of pocket expenses. There are some guidelines that differ from regular financing but they are manageable.

These loans are trying to help people with average income and average credit scores obtain financing. That is not to say if you have perfect credit you can not apply. It does allow for scores as low as 640. The area where most people have trouble qualifying is too high of an income. The program allows for 115% of the median income for the county. Most counties in the State of Wisconsin are between $74,000 and $83,000 for median income. You have to include all income for the entire household.

Location is the other area where this loan program fails. Most cities with a population over 10,000 people will not qualify. There are some exception to the rule and that is why you should call and check the address of the home you would like to purchase. Larger cities that qualify are Hartford, Slinger, Hartland, Delafield, Burlington, Waterford, Muskego, Mukwonago and Sussex. These are just a few cities close to larger populated areas that you may recognize. The most important thing is to call and we can enter the address and verify the home qualifies for this program.

There is NO PMI on this loan. There is a funding fee of 3% that is financed on top of the purchase price. That means if you have a purchase price of $100,000 you would have a loan amount of $103,000. The difference between the payment of these two loans at 6% interest is $18 per month. The PMI for that same loan would be $95.83 per month. You can see the additional $3000 on top of the purchase price keeps your monthly payment lower.

The underwriter will be looking very close at you as the borrower. They will be looking just as hard at the appraisal. They want to limit any potential future risk in case the property is foreclosed. That means buying a house that needs work to be performed may not fit this program. A house with a high sales price compared to other properties in the area may not work.

I am here to tell you 100 percent financing in Wisconsin is alive and well. Give us a call when you want to make that Wisconsin home purchase and we will get you and most importantly the house approved.

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