Overview
A USDA home loan from the USDA loan program, also known as the USDA Rural Development Guaranteed Housing Loan Program, is a mortgage loan offered to rural property owners by the United States Department of Agriculture. Any individual or family who plans to occupy a home located in an eligible rural area as their primary residence may qualify for a USDA Rural Development home loan.
Are you eligible for USDA products – USDA Rural Development offers a variety of services to help individuals, communities, businesses, and borrowers with their rural applications for funding or their existing loans and/or grants? Click here to check your USDA eligibility.
Types of USDA Home Loans
With a USDA loan, you don’t have to make a down payment; and you’re required to take a fixed rate loan. ARMs aren’t available via the USDA rural loan program. Rural loans can be used by first-time buyers and repeat home buyers alike. Homeowner counseling is not required to use the USDA program. For USDA you must qualify for the program and your home must be qualified, too. Check below if you may be eligible for USDA Products.
Guaranteed Loan
USDA Guaranteed home loans allow for higher income limits and 100% financing for home purchases. Applicants may have an income of up to 115% of the median household income for the area of the home
Direct Home Loans
USDA Direct Loans are primarily used to help low-income individuals or households purchase homes in rural areas. Funds can be used to build, repair, renovate or relocate a home
Features & Benefits of USDA Home Loans
The USDA Rural Development Single Family Housing Guaranteed Loan Program – or USDA Home Loan – is one of the most powerful mortgage options available for rural and suburban home buyers. USDA Loans come with significant benefits that provide home buyers the opportunity to achieve loan terms that no other program can offer
Down Payment
USDA loans require no down payment, you may finance up to 100% of the property value
Income
You must meet the income restrictions for the County you are interested in
Eligibility
To be eligible, you must be purchasing a property in a rural area as defined by the USDA
Owner Occupied
The home or property that you are looking to purchase must be owner-occupied, investment properties are not eligible for USDA loans
Fixed Rates
Competitive 30-year and 15-year fixed interest rates, USDA does not allow for ARMs
Loan Amounts
USDA has no maximum purchase price limit. (Lenders may vary on maximum loan amount)
Mortgage Insurance
USDA home loans similar to VA and FHA have mortgage insurance costs
Credit Score
Up until the year 2014, USDA did not have a required minimum credit score. As of 2014, the minimum credit score for USDA home loans is 640