USDA
Zero down, outside the city limits.
USDA guaranteed rural housing loans offer 100% financing with no down payment for eligible properties and household incomes across much of the map.
What makes this loan different
- Zero down payment
- Lower guarantee fees than FHA mortgage insurance
- Much of the map outside metro corridors is eligible
- Household income limits by county
Who this is built for
- Buyers in small towns and rural areas
- Households under the county income limit
- First-time buyers with no down payment
Eligibility has two halves
The property must be in an eligible area, and the household income must be under the county limit. Both are checked against current maps and tables, and both surprise people. Many towns that feel suburban are eligible, and the income limits count the whole household rather than just the borrowers.
When both boxes check, USDA is a way to buy a home with no down payment.
Costs
An upfront guarantee fee is financed into the loan and an annual fee is collected monthly, both typically lower than comparable FHA mortgage insurance.
What lenders typically ask for
- Standard income, employment, asset, and credit documentation
- Income documentation for all adult household members, not only the borrowers
- Confirmation that the property address falls within an eligible area
- Photo identification
Requirements vary by lender and by file. This is a general picture of what is commonly requested, not a checklist for a specific loan.
Worth knowing
Household income is tested, not just borrower income.
The income of adults living in the home generally counts toward the program cap even when they are not on the loan. This surprises applicants more than any other requirement.
Eligibility is drawn on a map.
The property has to sit in a designated eligible area, and boundaries are redrawn periodically. Many areas that feel suburban still qualify, and some that feel rural do not.
There are fees in place of mortgage insurance.
An upfront guarantee fee and an annual fee apply. The structure differs from both conventional mortgage insurance and FHA premiums.
Primary residence only.
The program does not finance second homes or investment property.
See what this program would take in your case.
We are brokers — this program is shopped across hundreds of wholesale lenders, not quoted off one rate sheet. A short application gives us enough to compare real options.
Program availability, terms, guidelines, and documentation requirements vary by lender and are subject to underwriting and change without notice. This is not a commitment to lend.