Features and Eligibility

• Down payment as low as 0%
• Broad qualification requirements
• Lower interest rates
• No prepayment penalty
• Allows broader range of income, debt, and credit history than conventional mortgages
• Requires guarantee fee 1% of the initial loan amount at closing, and 0.35% of the average annual unpaid balance each year
• May use gift funds for closing costs
• Only available to purchase a primary residence
• Property eligibility based on property size, location, and condition, and most fall in a USDA designated rural area
• Borrower must meet USDA's income eligibility limit (income cannot exceed 115% of the area's median household income)

Who Should Use a USDA Loan?

USDA loans are guaranteed by the United States Department of Agriculture (USDA) to provide affordable financing options for homes located in designated rural and some suburban communities. Borrowers who have less-than-optimal credit or limited funds available for a down payment might consider a USDA loan. Borrowers must meet income eligibility (cannot exceed 115% of media household income of that area) and be a U.S. Citizen, non-citizen national or Qualified Alien. The property must be located in a USDA designated rural area to qualify.

USDA Refinance Options Below