- Home Loan Options
- USDA Loan
USDA Loan
If you’re eligible, you can buy a rural home with no down payment required.
What To Know About USDA Loans
Who Are USDA Loans Best For?
A USDA loan might be a good mortgage option if you:
- Have low to moderate income
- Are buying a home in a designated rural area
- Can’t afford a large down payment
How Do USDA Loans Work?
- The home must be in a rural area with a population under 35,000.
- You pay an upfront guarantee fee as well as ongoing mortgage insurance.
- You typically make a $1,000 investment at closing that can be applied to any costs related to the transaction.
- You can choose a fixed or adjustable interest rate.
How Do I Qualify For A USDA Loan?
- You must meet income limits.
- The property you’re buying must be in an eligible rural area.
- You typically need a credit score of at least 620.
- The home must be your primary residence.
- You can check the U.S. Department of Agriculture’s website to find out if you and the property are eligible.
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USDA Loan Benefits
- No down payment is required.
- USDA loans often have lower interest rates than conventional loans.
- USDA loans often are cheaper than FHA loans.
- You don’t need to be a first-time home buyer.
- USDA loans don’t have prepayment penalties.
Refinancing With A USDA Loan
- You can refinance up to 100% of your home’s value.
- A USDA Streamlined refinance allows you to refinance without closing costs, an upfront fee or an appraisal.
- A USDA Streamlined-Assist refinance requires no income or credit verification.
- A non-streamlined refinance requires an appraisal but offers added equity and flexibility.
Frequently Asked Questions
Still have questions about USDA loans? We’ve got answers.
Do you have to buy farmland to use a USDA loan?
No, but the home must be in a rural area deemed eligible by the USDA
Can you use a USDA loan to buy a vacation or investment property?
No, USDA loans can only be used to purchase a primary residence.
What is the income limit for USDA loans?
The income limits for USDA loans vary depending on your location.
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