Arlington Real Estate Q&A about zero down USDA mortgage loans

Arlington Real Estate: Our post on October 1st regarding USDA Zero Down home loans created a stir among our costumers who presented us with a slew of questions. So we thought a follow up would be in order to  answer some of the questions. We presented the questions to Michelle Schmidt, an experienced mortgage loan originator with Cobalt Mortgage. We will post links at the bottom of this article to reach Michelle and Earl Schmidt for any unanswered questions or for help getting started on a USDA Zero Down loan today.


sallys house                                                This home can be purchased with a USDA Zero Down Loan.


              USDA Rural Home Loan Q & A


Costumer:  What is a USDA loan?

Michelle:  Financing for Single family properties located in outlaying rural areas, stick built homes on one acre or less. In Snohomish and King county maximum annual income is $93,450 for 1-4 persons living in the home and $123,350 for 5 or more.

Costumer:  How much will it cost to get in?

Michelle:  Zero down payment! Much of the time you can negotiate with the seller to pay a good portion, if not all of the closing costs. You can potentially buy a home for $1000 or less. Considerably less cash out of pocket than 1st and last months rent, plus damage deposit

Costumer:  What credit score do I need?   usda logo

Michelle:  Minimum median credit score of 640 is required

Costumer:  Where can I look for a home?

Michelle:  The boundaries are changing mid January 2014 consult with a professional Windermere Arlington Realtor or click here to confirm the eligible areas.

Costumer:  What if I have a Bankruptcy or foreclosure?

Michelle:  USDA requires you wait 3 years from the discharge of the Bankruptcy and 3 years from the trustee sale date of the foreclosure

Costumer:  How long does it take to close?

Michelle:  It generally takes 45-60 days to close a USDA, from start to finish.

Costumer:  How does it compare to FHA or other types of financing available

Michelle:  Down payment – Upfront Mortgage insurance – Monthly mortgage insurance

USDA- 0% 2.0% .40%

FHA- 3.5% 1.75% 1.35%

VA – 0% 3.3% – 2.15% None

Conventional 5% minimum depends on credit score .78% (credit score driven)

Costumer:  What if I own another home?

Michelle:  If you experience a job transfer from another area and you are not within a reasonable commuting distance, it is possible to keep the current home, provided the new home purchase using USDA financing is your primary residence. Otherwise your current home must be sold and closed prior to the new USDA loan closing.


USDA Zero Down Home Loan  Cobalt Mortgage now has a branch office located in the Windermere Arlington Building at 210 E Burke Ave.

Feel free to stop by or contact Michelle and Earl to get started on a home loan.


michelle for webMichelle Schmidt 




earl for webEarl Schmidt