Hey Friend,
Cardinal Elite National Homebuyer Assistance
The Cardinal Elite FHA Loan is designed for first-time buyers, and it combines a 30-year fixed-rate first mortgage with Down Payment Assistance (DPA) to help buyers reach their goal of homeownership. Let’s take a look at the key highlights:
Key Features:
- Primary Residence: This loan is available only for primary residences, making it an excellent choice for buyers who plan to live in the home long-term.
- Loan Term: 30-year fixed-rate, fully amortizing.
- Property Types: Eligible for 1-4 unit properties and manufactured homes.
- LTV/CLTV: Up to 96.5%, meaning buyers can secure a mortgage with as little as 3.5% down.
- DTI (Debt-to-Income): The program allows a maximum DTI of 31%/54%, though manual underwriting can push this to 50% in some cases, depending on compensating factors.
- Credit Score: A minimum score of 600 is required, which opens the door to a larger pool of potential buyers who may not have perfect credit.
- Manual Underwriting: Yes, manual underwriting is allowed with the right compensating factors.
USDA Loans
The USDA Rural Development Loan is another great option for homebuyers, particularly for those looking to purchase in rural or suburban areas. It’s a zero-down payment option, which makes it ideal for clients who need assistance covering their upfront costs.
Key Features:
- Property Types: This loan can be used for purchasing single-family homes, and the property must be located in an eligible rural area.
- Loan Terms: USDA loans offer 30-year fixed-rate terms.
- LTV/CLTV: The loan allows for 100% financing (no down payment required), which can be a significant benefit for buyers with limited savings.
- DTI: The maximum DTI for USDA loans is generally 34%/41%, but it can be higher in certain circumstances with compensating factors.
- Credit Score: USDA loans are more flexible on credit scores, and though 640 is generally the minimum for automated approval, we allow for 580 scores with manual underwriting.
- Location Requirements: The key eligibility factor is the property’s location in a USDA-designated rural area. This makes the loan a great option for buyers in less urbanized locations.
THDA Loans
The Tennessee Housing Development Agency (THDA) offers down payment and closing cost assistance to eligible homebuyers in Tennessee. This loan is designed to make homeownership more accessible, especially for first-time buyers.
Key Features:
- Primary Residence: The home must be the buyer’s primary residence.
- Loan Terms: Like the FHA loan, THDA offers 30-year fixed-rate mortgages.
- LTV/CLTV: Up to 96.5%, so buyers can secure the loan with just 3.5% down.
- DTI: The maximum DTI for THDA loans is typically 45%.
- Credit Score: A minimum 640 credit score is required, which can be an important consideration for clients with lower scores.
- Additional Benefits: THDA offers a variety of down payment and closing cost assistance options, making it an excellent choice for buyers who are struggling to cover their upfront costs. THDA also provides a “Great Choice Plus” program for additional financial support.
- Location Requirements: THDA loans are available only to borrowers purchasing homes within the state of Tennessee.
| Feature | Cardinal Elite FHA | USDA Loan | THDA Loan |
| Down Payment | 3.5% (with assistance) | 0% (No down payment) | 3.5% (with assistance) |
| DTI Limit | 31%/54% (up to 50% with manual underwriting) | 34%/41% | 45% |
| Credit Score Requirement | 600 | 640 (typically)
580 Manual |
640 |
| Property Type | 1-4 units, no singlewides | Single-family homes (2006+ singlewides) in rural areas | Single-family homes no singlewides |
| Location Requirements | No restrictions (except for property type) | Must be in a USDA-designated rural area | Tennessee only |
Final Thoughts
Choosing the right loan program for your clients is crucial to their success in the homebuying process. By understanding the key features of each loan, you can better guide your clients to the option that best suits their financial situation and goals.
P.S. Don’t let your buyers settle for ineffective financing. Let’s guide them toward the best financing options together. I’m available at (865) 745-5626.
Food For Thought:
The housing market in 2025 presents a mixed landscape for buyers and sellers. While mortgage rates are stabilizing around 6.5%, affordability remains a challenge due to high home prices and limited inventory. However, increased listings and a projected 3.3% rise in home sales offer potential opportunities for buyers. It’s crucial for prospective buyers to assess their financial readiness and consider long-term investment benefits, as waiting for significant market changes may not yield better conditions.
Happenings:
Jazz Tuesdays (Date: Every Tuesday, May 6 – June 24) in Knoxville are a beloved tradition, offering free live jazz performances every Tuesday evening from 7:00 to 9:00 PM on Market Square. Presented by the Knoxville Jazz Orchestra and the City of Knoxville, these concerts feature local and regional talent, creating a vibrant atmosphere in downtown Knoxville. Attendees are encouraged to bring lawn chairs or blankets to enjoy the music under the stars. The series runs from May through June and resumes in September, weather permitting.