USDA Loans
Zero-down-payment mortgages backed by the US Department of Agriculture for buyers in eligible rural and suburban areas.
USDA loans support homeownership in less-densely-populated areas through the Rural Development guarantee program. Eligible properties must be in a USDA-designated location, a map that includes a surprising amount of suburban America, not just farmland.
There's no down payment requirement and rates are competitive with conventional, often slightly lower. The program has income limits that vary by county and household size; buyers above the limit don't qualify regardless of credit strength.
Like FHA, USDA loans have both an upfront guarantee fee (financeable into the loan) and an annual fee paid monthly. The combined cost is generally lower than FHA's MIP structure, making USDA an attractive option when borrowers qualify on both location and income.
Related terms
Other terms you'll see alongside USDA Loans
A government-insured mortgage program designed to help buyers with lower credit scores or smaller down payments qualify.
Mortgages backed by the Department of Veterans Affairs for eligible service members, veterans, and qualifying surviving spouses.
The portion of a home's purchase price the buyer pays out of pocket up front, with the mortgage covering the rest.
The insurance premium paid on FHA loans, structured as both an upfront charge and an ongoing annual premium.
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