Finance
A New Mexico homebuyer is using a USDA Guaranteed Rural Housing loan. A key requirement is:
AThe property must be in an urban area
BThe property must be located in an eligible rural or suburban area and the buyer must meet income limits✓ Correct
CThe buyer must be a military veteran
DA 20% down payment is required
Explanation
USDA Guaranteed Rural Housing loans require the property to be in a USDA-eligible rural/suburban area and the buyer's income must not exceed area income limits (typically 115% of median income). No down payment is required.
People Also Study
Related New Mexico Questions
- The USDA Rural Development loan program can be used in qualifying rural and suburban areas of New Mexico and offers:Finance
- A New Mexico investor purchases a property for $380,000, using a 25% down payment. What is the loan amount and what is the LTV?Real Estate Math
- A borrower has a gross monthly income of $6,000. Using a 28% front-end ratio, what is the maximum monthly housing payment the lender will typically approve?Finance
- What is the minimum down payment required for an FHA loan for a borrower with a credit score of 580 or higher?Finance
- A New Mexico investor purchases a $400,000 commercial property with a 25% down payment. What is the loan amount?Real Estate Math
- A buyer in New Mexico puts $20,000 down and pays 1 origination point on a $200,000 loan. What is the total upfront cost excluding down payment?Real Estate Math
- A New Mexico homebuyer with excellent credit and a 20% down payment would most likely qualify for a:Finance
- A New Mexico buyer makes a 3.5% down payment on an FHA loan for a $310,000 home. What is the down payment amount?Real Estate Math
Key Terms to Know
Private Mortgage Insurance (PMI)
Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Math Concepts
Study This Topic
Practice More New Mexico Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free New Mexico Quiz →