What are USDA Mortgages?

Flower behind a fence in a rural area.

Looking to buy a home in the country? Maybe a USDA rural housing loan could help.

USDA rural housing loans are low to no money down mortgage products designed for home buyers in rural communities throughout the United States. USDA rural housing loans are only available in areas deemed eligible by the US Department of Agriculture (USDA). USDA home loan programs also have income requirements which must meet certain criteria. Unlike many conventional loan programs, making too much money may impact one’s ability to qualify as USDA mortgage programs are geared toward lower and middle income borrowers. USDA’s web site provides a tool where you can research a property by its address to see if it is in an area that qualifies. You may be surprised to find the some areas which you may view as non-rural are eligible.

USDA Rural Housing Loan Highlights (Subject to Change).

  • USDA financing for up to 100% of the appraised value or sales price of the home – whichever one is lower.
  • Unlike most low money down mortgage programs, there is no Private Mortgage Insurance (PMI).
  • Seller closing cost assistance may apply.
  • Home buyers must be US citizens, qualified aliens, legally admitted to the US for permanent residence.
  • Property must be used as borrower’s primary place of residence.

Looking for a conventional financing option? Use the rate table below to review rates from competing mortgage lenders, brokers, and banks. Note that the pricing is not for USDA home loans. You’ll need to contact the various companies directly for USDA pricing and eligibility.