Minimum Credit Requirements for USDA Loans Now Includes:
- Minimum number of trade lines to validate an applicant’s score is only two instead of 3
- Eligible trade lines include revolving (credit cards, lines of credit), installment loans (car loans, furniture loans, and other types of term loans), & mortgages
- Qualifying trade lines must be open at least 12 months
- Nontraditional or alternative credit is allowed to supplement the credit report to meet the requirement **
- At least one applicant whose income and assets are used for qualifying must have a valid credit score
** Alternative credit includes items such as car insurance, life insurance, utilities, cell phone, gym membership, small store accounts not reporting on credit, school tuition, and even a pattern of savings deposits.
Many thought it was amazing that we closed loans with only 1 credit reference on credit and two alternative credit references, but now we can do even better for buyers!! Check out these USDA limited credit success stories!