USDA Loan
The zero-down mortgage for rural and suburban buyers who qualify on income, not savings.
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Everything you need to know about the USDA Loan in under 3 minutes
What is the USDA Loan?
What are the benefits?
- No down payment required. Finance 100% of the home's purchase price.
- Low interest rates. The rates that are consistently lower than conventional loans.
- Lower mortgage insurance. USDA loans carry a 1% upfront guarantee fee and a 0.35% annual fee — significantly cheaper than FHA mortgage insurance.
- No loan limits on guaranteed loans. Your maximum loan amount is based on your income and ability to repay, not a fixed cap.
- Available to repeat buyers. You don't need to be a first-time homebuyer — the program is open to anyone who meets income and location requirements.
What are the requirements?
- Property must be located in a USDA-eligible rural or suburban area (verify at the USDA eligibility map)
- Total household income must not exceed 115% of the area median income — in most counties, that's $119,850 for 1–4 person households or $158,250 for 5–8 person households (2026 limits)
- All adult household members' income is counted, even if they're not on the loan
- Minimum credit score of 640 for automated underwriting; lower scores may require manual review
- Debt-to-income ratio generally up to 29% for housing costs and 41% for all debts combined
- Home must be a single-family primary residence — no investment properties or vacation homes
- Must be a U.S. citizen, permanent resident, or qualified alien
- Property must be modest in size and condition for the area
Today’s USDA Loan rates
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Frequently Asked Questions
- Can I really buy a home with zero down payment?
Yes. USDA Guaranteed Loans require no down payment, and you can finance up to 100% of the home’s purchase price. The 1% upfront guarantee fee can also be rolled into the loan, so many buyers close with little to nothing out of pocket — especially if the seller covers closing costs.
- Do I have to live in a remote rural area to qualify?
Not necessarily. The USDA defines eligible areas more broadly than most people expect — many suburban communities within 30 miles of a major city qualify. You can check any specific address using the USDA’s online property eligibility map at eligibility.sc.egov.usda.gov.
- Is there a maximum loan amount?
For USDA Guaranteed Loans (the most common type), there is no fixed loan limit. The maximum you can borrow is determined by your income, debts, and ability to repay. USDA Direct Loans, which are issued directly by the government for very low-income borrowers, do have regional loan limits.
- What does USDA mortgage insurance actually cost?
USDA loans don’t use traditional PMI. Instead, there’s a one-time upfront guarantee fee of 1% of the loan amount (which can be rolled in) and an annual fee of 0.35% of the remaining balance, paid monthly. On a $250,000 loan, that’s roughly $73/month — well below what FHA borrowers typically pay.
- Can I refinance a USDA loan later?
Yes. The USDA offers a streamlined refinance option that requires no appraisal and minimal documentation — making it one of the simpler ways to lower your rate if market conditions improve. Standard refinancing into a conventional loan is also available, and once your loan-to-value ratio falls below 80%, you can drop the annual guarantee fee entirely by refinancing out of the USDA program.
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