Loans for 100% financing in the New River Valley just might be going away.
For a long time, Christiansburg and Radford were both eligible areas for the USDA 100% financing option, but that just might be changing in the next 48 hours. According to Brandon Nicely of Alcova Mortgage, Oct 1 2012 changes to the USDA financing approval process mean that loan approvals for 100% loans in Christiansburg and Radford might not be available after Thursday. The process of approval is taking as much as 38 days, and the USDA loan program changes October 1st, so …. Thursday is our deadline. Truthfully, this isn’t good news for Christiansburg and Radford, which typically see a lot of first-time buyers, and the 100% loan program is a good option for them; and if buyers aren’t buying, it’s not good for sellers, either.
You can read about some of the changes to USDA here on Dan Green’s site.
I’m certain there’ll be more to come on this. For now, if you’d like to contact your representative and tell them of the impact eliminating USDA financing would have to your area, feel free to do so.
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Is the question whether or not the Oct 1 changes are starting early, or whether or not the October changes will go into effect?
Whether it goes into effect Oct 1. The approval process for USDA is so long that, if the changes take place, any loan not approved by close of business Sept 30 will get bounced, and funding will be unavailable.
Thanks for the info. Do you know if the changes will effect direct vs. guarenteed USDA loans differently?
Brian, I don’t know whether there’s a differentiation, no. You might want to try Brandon, at Brandon@AlcovaMortgage.com; I haven’t been able to call him today.
One bit of clarity I just discovered is that Christiansburg is being changed to “non-rural” based on population density and therefore will be completely inelegible for USDA Rural Development loans. The percentage changes in your linked article are annoyances, but this is the real biggie.