USDA Loans
Zero-down-payment mortgages backed by the U.S. Department of Agriculture, designed to encourage homeownership in rural and suburban areas.
Zero-down-payment mortgages backed by the U.S. Department of Agriculture, designed to encourage homeownership in rural and suburban areas.
Rural Development Loans
USDA loans offer 100% financing to eligible low-to-moderate-income homebuyers purchasing properties in designated rural areas. Despite the name, many suburban neighborhoods just outside major cities qualify for this program.
Why Choose a USDA Loan?
- No down payment required (100% financing).
- Competitive, low interest rates.
- Lower mortgage insurance premiums compared to FHA loans.
- Flexible credit guidelines for qualified borrowers.
- Can be used to build, repair, renovate, or relocate a home.
Who is Eligible?
- The property must be located in a USDA-designated eligible rural or suburban area.
- Household income cannot exceed 115% of the median income for the area.
- A minimum credit score is typically required (usually 640 for streamlined processing).
- The home must be your primary residence and cannot be an income-producing property (like a working farm).
- You must be a U.S. citizen, U.S. non-citizen national, or Qualified Alien.
What is the Process?
- Eligibility Check: We verify your income and the property's location to ensure both meet USDA requirements.
- Pre-Approval: We review your credit and financial history.
- Property Search: You find a home in a USDA-eligible area.
- USDA Appraisal: The home is appraised to ensure it meets USDA property standards (safe, sound, and sanitary).
- USDA Guarantee: After our underwriting, the file is sent to the USDA for final review and issuance of the loan guarantee.
- Closing: Finalize the loan and get your keys!
Is Mortgage Insurance Required?
USDA loans do not have traditional PMI, but they do require two fees that serve a similar purpose:
1. Upfront Guarantee Fee: A one-time fee (currently 1.0% of the loan amount) that is usually rolled into the loan balance.
2. Annual Fee: A monthly fee (currently 0.35% of the loan balance) included in your mortgage payment for the life of the loan.