Big Changes are coming to Rural Development October 1st, 2016. 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 we are all very proud of.
Dave: Mike could you talk a little bit about the changes that are coming up in 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 saving.
Mike: On $150,000 loan that’s a saving 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 saving 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 knows 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.