USDA Construction Loan Requirements 2024 Full Guide!

The USDA Construction Loan allows for eligible individuals to finance a home build with ZERO down payment! In this video, home buyers will learn how to apply for the USDA construction to permanent loan, what the requirements are how the building process works!

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Hi, I’m Nicole Nark, a full-time Realtor® at HomeWay Realty in Little Rock. I came to Little Rock with the love of my life, I am a proud Mom of two furbabies (Mini Schnauzer Mix and German Shepard), a Graduate of Communications from the University of Arkansas-Fayetteville and Honor Graduate of Arkansas Real Estate School in Little Rock.

I believe that home ownership lays the foundation for a life of financial security and freedom.

From building equity in a home, to the tax benefits it provides, buying a home is the most important financial decision most people make during their life. For this reason it is important to work with a professional who is committed to act as an advocate for you and your best interests.

Learn more about me and the services I provide here:
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Disclaimer: The topics discussed, and ideas presented are Nicole Nark's opinions and presented for entertainment purposes only. Nicole Nark is a licensed Realtor with HomeWay Realty, but she is not advising or representing you in these videos. The information presented should not be construed as financial or legal advice. Always do your own due diligence.

[JosephMbidi]

I love this program. I do have this program. My mortgage monthly $450. as I have a nice credit score 895. I have 4 bedrooms single family houses. Thanks god

[davep]

The USDA program is great in theory but in practice extremely difficult to use. I live in a good area for construction with dozens and dozens of builders and banks as well as mortgage specific institutions. NONE of the lenders in the area work with the USDA loan. I had to go to an online lender. Then, as she stated, finding a builder who was willing to work within USDA guidelines was difficult. And then, of course, that builder took on more work than they could do because they were tying to squeeze every dollar they could out of the freak market that was 2020 into middle 2022. So, they more than tripled their original estimate between our first consultation and their final bid. Well, that ended things real quick. So, more than a year later I'm starting the process again. Lenders and builders had it good for several years and got used to a run of success they foolishly thought would last forever. Builders are more receptive to working with the USDA program than they were a year ago when they couldn't keep track of all the requests to build but they are still way overpriced. And I am back to the same online mortgage company because no one in my area seems to have gotten the message that the good times are winding down and it might be a good idea to expand your lending options.

[juliacassidy]

This video has been more helpful than all the articles I’ve read and all the lenders/realtors I’ve asked about this loan combined!

[ashabrewer]

Thank you Ms. Nark! You provide such important and detailed information. Plus, you've helped me get closer to my dream of building my home. After 3 years of intense looking, I've found a property that is exactly what I wanted. I will live on my 5-acre property in my beautiful custom-built house by next year, if not sooner. Now I'm just hoping for a miracle because I would love for one of those companies that print 3D houses to reach out to me. Thank you for doing what you do!

[burlyfishmonger]

This was the perfect video at the perfect moment! I am considering the USDA construction loan however I might go with FHA. I am in the process of buying undeveloped property on a 15 ye fixed, debating if I will switch to an ARM before closing as I expect to build within 5 years. I have to wait, though, while I rebuild my savings. The 20% down and closing costs are going to empty out what I have now, but I think it will be worth it. Thank you for this video, as it makes me feel like I can still make this happen.

[ppportal]

Guys, the reality is, like most things, your success will be directly correlated to YOUR efforts, YOUR drive and tenacity, YOUR resolve to not take NO for AN ANSWER, and ur ability to pursue workarounds when roadblocks occur. But all of what u are hearing here IS TRUE IS POSSIBLE, but understand there will be frustration. But any hiccups just make the end game that much more satisfying once u cross that finish line, oops I mean “threshold”, into your new crib!

[RAIBACH-ll]

I would like to make an arrangement with the seller in a letter of intent to purchase, to allow me some time to secure financing. I'm not interested in getting lower price necessarily. The negotiations are about time, and for this uncommon place, time is money.

I have to find a USDA approved Builder, I have to get some stuff before I know if USDA will guarantee the loan or if a bank will finance it. I want 30 days to work this uncommon situation out, without the fear of a cash buyer coming in while I'm working on it. And I want to do this with a Letter of intent to purchase.

With a “no shop” clause to prevent the seller from finding another buy in the middle of the process.Only because a LOI is non-binding traditionally.

[peterb.houtman]

Would like to hear about the VA CTP loan process. Thanks for the great info

[jessicapowell]

How do we go about applying for the construction loan? Do we have to buy the property first? Or can we buy the land with a construction loan and roll it into a mortgage? Also any tips for help with closing costs and blueprints?

[ketinathompson]

Thank you, Nicole! This is exactly what I was looking for this information. I live in the area where United Home Built is a home builder company

[lla]

Love your work. Can you please do a updated video on Fha requirements with the down payment assistance programs that are offered and those requirements. Ive heard that there is Chenoa and the new 10 % down program what could they cover in cost

[EC-umkh]

how long do you have to live in home, In case you need to sell?

[rms-vphf]

It isn’t a loan. It is a “guarantee” from the government they will pay if you don’t. The Federal Government is basically co-signing for you on the riskiest form of RE lending. You still have to find an actual lender who have the by-laws etc to do it. It isn’t a slam dunk sadly. Know the program, any CFRs involved and the proposed lender’s criteria for FHA/VA/USDA so when they say “no, because…” you can counter with why it has to be “Yes”. If you meet the criteria and they say no it’s discriminatory. That’s why the criteria are so specific.

[arcatacompany]

Barndiminium" love it, never heard that name but I know exactly what your saying and just saw a nice place that was a barndiminium

[justaninja]

Does USDA do multi family if you live in one of the units?

[islandbound]

Thank you for this. This is so helpful. This information is pretty tough to come by in general

[mariagomes]

Excellent information! I am buying a lot right now and these are valuable info for me. Thank you

[NevaJWilson]

When I'm figuring on the calculator can I use the gross up for SSDI.

[elizabethchapman]

Thank you so much! I’d been searching for someone to break this down. Really appreciate you taking the time ❤

[nesymphony]

Thank you for always sharing valuable information on your platform, greatly appreciated