100% Financing Still Available in San Mateo County
That’s right, 100% financing is still available for San Mateo County home buyers. We’ve talked about FHA financing, which requires 3.5% down payment. But, with the tightening of the guidelines and with FHA’s monthly and upfront mortgage insurance, which can add a significant amount to your monthly mortgage payment and closing costs, borrowers need to have more cash. With this 100% financing program from the USDA (yes, the beef people!), you could literally close escrow without spending a dime of your own money.
Highlights of the 100% Financing USDA Home Loan Program
- No Down Payment Required
- No Monthly Mortgage Insurance (like an FHA loan)
- Seller Can Pay for Reasonable Closing Costs and Prepaids
- No Increased Mortgage Interest Rates for Zero Down Payment
- Not Just for San Mateo First Time Home Buyers
- No Cash Reserves Needed
- All Reasonable Closing Cost and Prepaids Can be Rolled into the Mortgage Without the Seller Paying the Cost (as long as home appraises for increased loan amount)
Become a Homeowner without Touching Your Savings
Because this 100% financing program allows you to finance the costs to close the loan into the original loan amount (as long as the home appraises for the increased loan amount), you could close escrow on a San Mateo County home without using any of your savings.
Income Eligibility
The USDA 100% financing program does have income eligibility requirements.
Property Location Restrictions
One of the requirements of this loan program is the property must be located in a “rural” area. No, this doesn’t mean a place where there is no running water or streets, it simply means the property must be located within an area classified by the USDA as rural. In San Mateo County, we are talking the Coastal Cities South of Pacifica. A greater percentage of Santa Cruz and Monterey County qualify, as well as parts of Contra Costa, Alameda and Santa Clara Counties. Downtown San Mateo, however, would not qualify.
To view a detailed map of eligible properties, you can visit the USDA property eligibility site and search by County or address.
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Chris Williamson is a Mortgage Advisor with Mortgage California specializing in San Mateo Mortgage.
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