USDA Loans

Loan Programs

When people hear "USDA loan," they often picture farms. In reality, USDA loans help families buy homes in many small towns and suburbs, often with no down payment at all. If you're open to living a little outside the city, this program is worth a look.

What Is a USDA Loan?

A USDA loan is a mortgage backed by the U.S. Department of Agriculture through its Rural Development program. The most common version is the Single Family Housing Guaranteed Loan. A private lender like us makes the loan, and the USDA guarantees part of it. That guarantee allows 100% financing for qualified buyers.

USDA loans are for primary homes only. They're offered as 30-year fixed-rate loans, which keeps your principal and interest payment steady for the life of the loan.

Eligible Areas

The home must be in an area the USDA considers rural. That definition is broader than most people expect. Many communities just outside larger cities qualify, and in some states a large share of the land area is eligible.

The USDA publishes an online eligibility map where you can enter an address and see instantly whether it qualifies. Eligible areas are reviewed from time to time, so it's smart to check each property you're considering. Send me an address anytime and I'll look it up for you.

Keep in mind that the property itself must also meet basic standards. It should be modest in size for the area, structurally sound and used as your primary residence. Income-producing features like a working farm aren't allowed.

Income Limits

USDA loans are designed for low- to moderate-income households. Your total household income generally can't be more than 115% of the median income for your area (as of 2026, subject to change). The limit goes up with household size and differs by county.

"Household income" includes everyone who will live in the home and is age 18 or older, even if they won't be on the loan. Certain deductions, such as for children, elderly household members and childcare costs, can lower the income that's counted. You'll also need to show you can repay the loan, usually with a debt-to-income ratio in the low 40s or less and a credit history that shows responsible borrowing.

Benefits

No down payment required. You can finance up to 100% of the purchase price.
Lower mortgage insurance costs. USDA charges an upfront guarantee fee of 1% (which can be financed) and an annual fee of 0.35% of the balance, paid monthly (as of 2026, subject to change). That's often less than FHA mortgage insurance.
Competitive rates. The government guarantee helps keep pricing attractive.
Closing cost help. If the home appraises for more than the price, some closing costs can be included in the loan. Sellers can also contribute.
Flexible credit. There's no official minimum score, though most lenders look for about 640 for streamlined approval.

How to Apply

Check the address. Make sure the areas you like are USDA eligible.
Check your income. I'll calculate your household income against the local limit.
Get pre-approved. We'll review your credit, income and assets so you can shop with confidence.
Find your home and make an offer. Your agent can ask the seller for closing cost help.
Appraisal and underwriting. The lender approves the loan, then the file goes to USDA for its final review.
Close and move in.

Because USDA reviews each loan after the lender approves it, plan on a slightly longer timeline than a conventional loan. Starting early and having documents ready makes a big difference.