Finance
A Florida buyer is using a USDA Rural Development loan to purchase a home. Which requirement applies to USDA loans?
AThe borrower must be a veteran or active military member
BThe property must be located in an eligible rural or suburban area as defined by USDA✓ Correct
CA minimum 5% down payment is required
DThe loan can only be used for new construction
Explanation
USDA Rural Development loans (Section 502 Guaranteed loans) are available in eligible rural and smaller suburban areas as designated by USDA — not urban areas. They offer 100% financing (no down payment) for qualifying borrowers. The borrower must meet income limits, and the property must be in an eligible area. Florida has many USDA-eligible areas, particularly in rural counties.
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