Home Loans Arizona - California - Nevada - Utah

Buying a house can be an exciting yet daunting process, especially when you’re faced with the challenge of saving for a down payment. However, for many homebuyers in Nevada, the USDA Home Loan Program offers an incredible opportunity to buy a house with no money down. This program is a great option for those who meet the requirements but are limited on funds.

In this blog post, we’ll walk you through the steps on how to buy a house in Nevada with no money down using the USDA Program, explore what USDA is, discuss who is eligible for the program, and show you where the USDA-approved areas in Nevada are located. Let’s dive into how this program can help you become a homeowner without having to worry about saving for a down payment.

What is the USDA Home Loan Program?

The USDA Home Loan Program, officially known as the USDA Rural Development Loan, is a government-backed mortgage option designed to help low- and moderate-income buyers purchase homes in designated rural and suburban areas. The United States Department of Agriculture (USDA) offers this program to stimulate homeownership in areas that are not in highly urbanized or densely populated regions.

One of the biggest benefits of the USDA program is that it offers 100% financing, meaning you don’t have to worry about a down payment. This makes it an excellent choice for first-time homebuyers or anyone looking to buy a house without having to save for a significant down payment.

Who Does USDA Loan Program Help?

The USDA Home Loan Program is aimed at providing affordable housing options for individuals and families who may have difficulty saving for a large down payment. While it is primarily designed for first-time homebuyers, the USDA loan is not restricted to them. Even if you’ve owned a home before, you may still qualify for this program.

To qualify for a USDA loan, there are a few key eligibility requirements that you need to meet:

1. Income Limits: The USDA loan program has income limits that vary by household size and location. For one to four people in the household, the income limit is $103,500 in most areas of Nevada. For households of five or more people, the income limit increases to $136,600. These limits may change over time, so it’s important to check the most up-to-date information for your area.

2. Location Requirements: The home you are purchasing must be in a USDA-approved area. While major cities like Las Vegas, Reno, and Carson City are generally not eligible, rural areas in Nevada qualify. There are vast areas within Nevada, including towns like Pahrump, Mesquite, and Boulder City, that are eligible for USDA loans.

3. Credit Score: The USDA generally requires a minimum credit score of 620. However, some lenders may have more stringent requirements, and other factors like your debt-to-income ratio and financial history may influence your eligibility.

4. Owner-Occupied: The USDA loan program is strictly for primary residences. The property must be your primary home and cannot be used as an investment property, second home, or vacation property.

Buy a House in Nevada with No Money Down

Where Are the USDA Approved Areas in Nevada?

To qualify for a USDA loan, the property you are purchasing must be located in an approved USDA lending area. Fortunately, Nevada has a wide range of areas that qualify, especially if you're willing to look beyond the major metropolitan cities.

Here are a few examples of USDA-approved areas in Nevada:

• Pahrump: Located about 60 miles west of Las Vegas, Pahrump is a great option for those looking to live near Las Vegas but in a more rural area.
• Mesquite: A rapidly growing town near the Arizona border, Mesquite offers an excellent alternative to living in the Las Vegas metro area while still being close to major amenities.
• Boulder City: Situated near Lake Mead and just outside Las Vegas, Boulder City is a charming, small town with eligibility for USDA loans.
• Gene and State Line: These areas near the Nevada/California border are also approved USDA areas, although they are more remote.

While areas like Reno and Las Vegas are generally not USDA-approved, many of the surrounding towns and rural regions in the state qualify. You can easily check if a specific address is eligible using the USDA’s online eligibility tool.

USDA Loan Requirements for Nevada

In addition to meeting the location and income requirements, there are a few more key factors that determine whether you can successfully secure a USDA loan for buying a home in Nevada:

1. Debt-to-Income Ratio:

   • The USDA has stricter debt-to-income (DTI) ratio requirements than other loan programs like FHA or VA loans. Generally, the front-end DTI ratio (which is the percentage of your income spent on housing expenses) should not exceed 29%, and the back-end DTI ratio (which includes other debt obligations) should not exceed 41%.

2. No Down Payment:

   • The most attractive feature of the USDA loan is the no money down requirement. As long as you meet the other eligibility criteria, you can purchase a home with 100% financing, which means you won’t need to save for a large down payment. While you aren’t required to put money down, some buyers may still choose to make a down payment.

3. Closing Costs:

   • While the USDA loan eliminates the need for a down payment, buyers are still responsible for closing costs. However, there are ways to manage these costs. The seller may be willing to cover the closing costs, or you can receive a gift from a family member to help with the expenses. Additionally, if the property appraises for more than the purchase price, the USDA loan will allow you to finance the closing costs as part of the loan, which can significantly reduce your out-of-pocket expenses.

How to Buy a House in Nevada with No Money Down Using USDA

1. Find a USDA-Approved Property:

   • Start by using the USDA property eligibility tool to search for homes in USDA-approved areas. This tool will help you identify whether a specific property qualifies for USDA financing.

2. Meet the Income Requirements:

   • Make sure that your household income does not exceed the USDA limits for your area. For example, in most areas of Nevada, you cannot earn more than $103,500 if you have a household of one to four people.

3. Get Pre-Approved for a USDA Loan:

   • Contact a licensed mortgage professional who specializes in USDA loans, such as Nathan Rufty at Canopy Mortgage. Nathan can guide you through the application process, helping you secure pre-approval and understand the eligibility criteria.

4. Submit Your Application:

   • Once pre-approved, you can submit your formal application to the USDA for final approval. This will involve providing documentation such as proof of income, employment, and credit score.

5. Close the Loan:

   • If approved, you’ll proceed to closing. The USDA loan will cover 100% of the home’s purchase price, and you can arrange for the seller to cover closing costs if applicable.

Buy a House in Nevada No Money Down

Get Started with Nathan Rufty

If you're interested in buying a house in Nevada with no money down through the USDA loan program, Nathan Rufty, a licensed mortgage professional at Canopy Mortgage, can help you navigate the process. With over 20 years of experience in the lending industry, Nathan is dedicated to providing top-notch customer service and ensuring that you find the best loan program for your needs.

Call Nathan directly at 909-503-5600 to discuss how the USDA loan program can work for you, or visit Canopy Mortgage for more information.

With the USDA loan program, buying a house in Nevada with no money down has never been easier. Take advantage of this incredible opportunity and contact Nathan Rufty today to start your journey toward homeownership!