USDA Loans
USDA loans are home loans that are administered by the U.S. Department of Agriculture. There are two types of USDA loans, guaranteed loans, and direct loans.
When you take out a USDA loan, you are required to occupy the property personally. But if you have owned the property for at least three years, then you can use it as a rental. However, this only applies to a USDA guaranteed loan. A property with a USDA direct loan can’t be used as a rental. If you decide to rent your house, you will no longer be eligible for subsidy assistance and other servicing options. Since owner occupancy is a must, any payment subsidy you’re receiving will be canceled.
- It lets you live elsewhere without having to pay for an unoccupied home.
- It offers you an additional source of income.
- It’s a good source of income if you can’t sell your house.
- You have to cover the costs of preparing your house for tenants.
- You will be responsible for repairing and maintaining the rental property.
- You need to accept that there are risks of property damage and missed rental payments. Read more