What happens if a borrower meets all four criteria for traditional conventional financing?

Meeting all four criteria for traditional conventional financing generally indicates that a borrower has a strong financial profile and can qualify under those guidelines. As a result, they are not eligible for USDA loans, which are specifically designed to assist low- to moderate-income borrowers in rural areas who may not meet the stricter requirements of conventional financing.

USDA loans have certain eligibility criteria aimed at ensuring they serve individuals who may not have access to conventional loans due to lower income or credit profiles. Thus, if a borrower qualifies fully for conventional financing, it indicates they have financial stability beyond what USDA loans aim to support, making them ineligible for the benefits and opportunities provided under the USDA program.

Being eligible for USDA loans implies a need for assistance that those qualifying for conventional loans typically do not have. Therefore, qualifying for conventional financing acts as a barrier to USDA loan eligibility.