If you meet income guidelines, you can buy a home in a qualifying rural area for 0% down.
USDA loans are an attractive option for buying a home in a qualifying rural area, especially if you're a first-time home buyer. These are some of the benefits:
- USDA loans require no down payment unlike FHA and conventional loans.
- You can qualify with a credit score as low as 640.
- In most cases, the USDA monthly guarantee fee will be lower than FHA monthly mortgage insurance.
Start Your USDA Loan Application Today
How USDA Loans Work
USDA loans, also known as rural development loans, are backed by the U.S. Department of Agriculture and provide affordable mortgage options for homes in rural areas.
If you're buying a home, you can get a USDA loan as a 30-year fixed-rate mortgage. If you already have a USDA loan, you can refinance it into a new USDA loan; however, you can't refinance with a USDA loan if you currently have a different loan type.
USDA Loan Eligibility Requirements
To get a USDA loan, you must meet these qualifications:
- You need a credit score of at least 640.
- The home you want to buy must be in an eligible rural area. Find out if your property is eligible.
- The property can't be a working farm.
- Your household income must be within limits set by the USDA for the area where you want to buy a home. Check your income eligibility with the USDA.
Understanding the USDA Guarantee Fee
USDA loans require an upfront guarantee fee and an annual guarantee fee, similar to upfront mortgage insurance and monthly mortgage insurance for FHA loans. These guarantee fees are generally lower than mortgage insurance premiums for FHA and may save you money on your monthly mortgage payment.
Other Loan Options
If a USDA loan doesn't work for you, these loan options are also available with low down payments and flexible credit requirements:
- FHA Loan – Qualify with a credit score as low as 580 and a down payment as low as 3.5%.
- VA Loan – Take advantage of exclusive benefits for active-duty military personnel, veterans and their families.
- Adjustable Rate Mortgage (ARM) – Get the lowest mortgage rates available. ARMs are a great option if you plan to sell the home or refinance in the next few years.
Why You Should Choose Quicken Loans for Your USDA Loan
- As an approved USDA lender, we’ll guide you through the USDA mortgage process so you understand the details and get the right mortgage for your situation.
- You’ll get a completely online application process with less paperwork, and you can track the status of your mortgage application.
- After you close your loan, you can manage your mortgage online without any hidden fees.
- We service 99% of our mortgages, which means you can expect our great customer service to continue after you close.