USDA Loan Calculator.

USDA Mortgage Calculator

Use this free tool to figure your monthly payments on a fixed-rate USDA mortgage for a given loan amount. By default the USDA loan guarantee fee is rolled into the loan. Borrowers can unclick the associated check box if they do not wish to finance that fee in their mortgage. Current home loan rates are shown beneath the calculator.


Loan Information Amount
Loan Information
Home loan amount: $
Current Interest Rates: %
Term of the loan: years
USDA Guarantee Fee: %
Finance Loan Guarantee Fee:
Annual USDA MIP Fee: %
Discount Points: %
Any Other Closing Costs: $
Home Information
Property Value: $
Annual Real Estate Taxes: $
Annual Homeowner's Insurance: $
Monthly HOA Dues: $
 
USDA Home Loan Summary for a 30-yr $262,626.00 Mortgage

$1,330.69

Monthly Principal & Interest Payment

$262,626.00

Loan Amount

$451.60

Other Monthly Costs of Ownership

30 years

Term of Loan

$1,782.29

All-inclusive Monthly Payment

4.50%

Interest Rate

$0.00

Cost of Discount Points

$2,626.00

Cost of USDA Loan Guarantee

$0.00

Other Closing Costs

$2,626.00

Total Closing Costs

Current 30-Year Mortgage Rates on a $200,000 Home Loan

The following table highlights locally available current mortgage rates. By default 30-year purchase loans are displayed. Clicking on the refinance button switches loans to refinance. Other loan adjustment options including price, down payment, home location, credit score, term & ARM options are available for selection in the filters area at the top of the table.

Amortization Schedule for a $262,626.00 30-Year Fixed-rate Home Loan @ 4.50% APR

Year Month Interest Principal Balance
1 1 $984.85 $345.84 $262,280.16
1 2 $983.55 $347.14 $261,933.02
1 3 $982.25 $348.44 $261,584.58
1 4 $980.94 $349.75 $261,234.84
1 5 $979.63 $351.06 $260,883.78
1 6 $978.31 $352.37 $260,531.41
1 7 $976.99 $353.69 $260,177.72
1 8 $975.67 $355.02 $259,822.69
1 9 $974.34 $356.35 $259,466.34
1 10 $973.00 $357.69 $259,108.65
1 11 $971.66 $359.03 $258,749.62
1 12 $970.31 $360.38 $258,389.25
Totals for year 1 $11,731.50 $4,236.75 $258,389.25
2 1 $968.96 $361.73 $258,027.52
2 2 $967.60 $363.08 $257,664.44
2 3 $966.24 $364.45 $257,299.99
2 4 $964.87 $365.81 $256,934.18
2 5 $963.50 $367.18 $256,566.99
2 6 $962.13 $368.56 $256,198.43
2 7 $960.74 $369.94 $255,828.49
2 8 $959.36 $371.33 $255,457.16
2 9 $957.96 $372.72 $255,084.44
2 10 $956.57 $374.12 $254,710.31
2 11 $955.16 $375.52 $254,334.79
2 12 $953.76 $376.93 $253,957.86
Totals for year 2 $11,536.86 $4,431.39 $253,957.86
3 1 $952.34 $378.35 $253,579.51
3 2 $950.92 $379.76 $253,199.75
3 3 $949.50 $381.19 $252,818.56
3 4 $948.07 $382.62 $252,435.94
3 5 $946.63 $384.05 $252,051.89
3 6 $945.19 $385.49 $251,666.40
3 7 $943.75 $386.94 $251,279.46
3 8 $942.30 $388.39 $250,891.07
3 9 $940.84 $389.85 $250,501.22
3 10 $939.38 $391.31 $250,109.92
3 11 $937.91 $392.78 $249,717.14
3 12 $936.44 $394.25 $249,322.89
Totals for year 3 $11,333.28 $4,634.97 $249,322.89
4 1 $934.96 $395.73 $248,927.17
4 2 $933.48 $397.21 $248,529.96
4 3 $931.99 $398.70 $248,131.26
4 4 $930.49 $400.20 $247,731.06
4 5 $928.99 $401.70 $247,329.37
4 6 $927.49 $403.20 $246,926.16
4 7 $925.97 $404.71 $246,521.45
4 8 $924.46 $406.23 $246,115.22
4 9 $922.93 $407.76 $245,707.46
4 10 $921.40 $409.28 $245,298.18
4 11 $919.87 $410.82 $244,887.36
4 12 $918.33 $412.36 $244,475.00
Totals for year 4 $11,120.35 $4,847.90 $244,475.00
5 1 $916.78 $413.91 $244,061.09
5 2 $915.23 $415.46 $243,645.63
5 3 $913.67 $417.02 $243,228.62
5 4 $912.11 $418.58 $242,810.04
5 5 $910.54 $420.15 $242,389.89
5 6 $908.96 $421.73 $241,968.16
5 7 $907.38 $423.31 $241,544.86
5 8 $905.79 $424.89 $241,119.96
5 9 $904.20 $426.49 $240,693.47
5 10 $902.60 $428.09 $240,265.39
5 11 $901.00 $429.69 $239,835.70
5 12 $899.38 $431.30 $239,404.39
Totals for year 5 $10,897.64 $5,070.61 $239,404.39
6 1 $897.77 $432.92 $238,971.47
6 2 $896.14 $434.54 $238,536.93
6 3 $894.51 $436.17 $238,100.75
6 4 $892.88 $437.81 $237,662.94
6 5 $891.24 $439.45 $237,223.49
6 6 $889.59 $441.10 $236,782.39
6 7 $887.93 $442.75 $236,339.64
6 8 $886.27 $444.41 $235,895.23
6 9 $884.61 $446.08 $235,449.14
6 10 $882.93 $447.75 $235,001.39
6 11 $881.26 $449.43 $234,551.96
6 12 $879.57 $451.12 $234,100.84
Totals for year 6 $10,664.70 $5,303.55 $234,100.84
7 1 $877.88 $452.81 $233,648.03
7 2 $876.18 $454.51 $233,193.53
7 3 $874.48 $456.21 $232,737.31
7 4 $872.76 $457.92 $232,279.39
7 5 $871.05 $459.64 $231,819.75
7 6 $869.32 $461.36 $231,358.39
7 7 $867.59 $463.09 $230,895.30
7 8 $865.86 $464.83 $230,430.47
7 9 $864.11 $466.57 $229,963.89
7 10 $862.36 $468.32 $229,495.57
7 11 $860.61 $470.08 $229,025.49
7 12 $858.85 $471.84 $228,553.65
Totals for year 7 $10,421.05 $5,547.19 $228,553.65
8 1 $857.08 $473.61 $228,080.04
8 2 $855.30 $475.39 $227,604.65
8 3 $853.52 $477.17 $227,127.48
8 4 $851.73 $478.96 $226,648.52
8 5 $849.93 $480.76 $226,167.77
8 6 $848.13 $482.56 $225,685.21
8 7 $846.32 $484.37 $225,200.84
8 8 $844.50 $486.18 $224,714.66
8 9 $842.68 $488.01 $224,226.65
8 10 $840.85 $489.84 $223,736.81
8 11 $839.01 $491.67 $223,245.14
8 12 $837.17 $493.52 $222,751.62
Totals for year 8 $10,166.22 $5,802.03 $222,751.62
9 1 $835.32 $495.37 $222,256.25
9 2 $833.46 $497.23 $221,759.02
9 3 $831.60 $499.09 $221,259.93
9 4 $829.72 $500.96 $220,758.97
9 5 $827.85 $502.84 $220,256.13
9 6 $825.96 $504.73 $219,751.40
9 7 $824.07 $506.62 $219,244.78
9 8 $822.17 $508.52 $218,736.26
9 9 $820.26 $510.43 $218,225.84
9 10 $818.35 $512.34 $217,713.50
9 11 $816.43 $514.26 $217,199.23
9 12 $814.50 $516.19 $216,683.04
Totals for year 9 $9,899.67 $6,068.57 $216,683.04
10 1 $812.56 $518.13 $216,164.92
10 2 $810.62 $520.07 $215,644.85
10 3 $808.67 $522.02 $215,122.83
10 4 $806.71 $523.98 $214,598.85
10 5 $804.75 $525.94 $214,072.91
10 6 $802.77 $527.91 $213,545.00
10 7 $800.79 $529.89 $213,015.10
10 8 $798.81 $531.88 $212,483.22
10 9 $796.81 $533.88 $211,949.35
10 10 $794.81 $535.88 $211,413.47
10 11 $792.80 $537.89 $210,875.58
10 12 $790.78 $539.90 $210,335.68
Totals for year 10 $9,620.88 $6,347.36 $210,335.68
11 1 $788.76 $541.93 $209,793.75
11 2 $786.73 $543.96 $209,249.79
11 3 $784.69 $546.00 $208,703.79
11 4 $782.64 $548.05 $208,155.74
11 5 $780.58 $550.10 $207,605.64
11 6 $778.52 $552.17 $207,053.47
11 7 $776.45 $554.24 $206,499.23
11 8 $774.37 $556.32 $205,942.92
11 9 $772.29 $558.40 $205,384.52
11 10 $770.19 $560.50 $204,824.02
11 11 $768.09 $562.60 $204,261.43
11 12 $765.98 $564.71 $203,696.72
Totals for year 11 $9,329.29 $6,638.96 $203,696.72
12 1 $763.86 $566.82 $203,129.89
12 2 $761.74 $568.95 $202,560.94
12 3 $759.60 $571.08 $201,989.86
12 4 $757.46 $573.23 $201,416.63
12 5 $755.31 $575.37 $200,841.26
12 6 $753.15 $577.53 $200,263.73
12 7 $750.99 $579.70 $199,684.03
12 8 $748.82 $581.87 $199,102.16
12 9 $746.63 $584.05 $198,518.10
12 10 $744.44 $586.24 $197,931.86
12 11 $742.24 $588.44 $197,343.41
12 12 $740.04 $590.65 $196,752.76
Totals for year 12 $9,024.29 $6,943.95 $196,752.76
13 1 $737.82 $592.86 $196,159.90
13 2 $735.60 $595.09 $195,564.81
13 3 $733.37 $597.32 $194,967.49
13 4 $731.13 $599.56 $194,367.93
13 5 $728.88 $601.81 $193,766.13
13 6 $726.62 $604.06 $193,162.06
13 7 $724.36 $606.33 $192,555.73
13 8 $722.08 $608.60 $191,947.13
13 9 $719.80 $610.89 $191,336.24
13 10 $717.51 $613.18 $190,723.07
13 11 $715.21 $615.48 $190,107.59
13 12 $712.90 $617.78 $189,489.81
Totals for year 13 $8,705.29 $7,262.96 $189,489.81
14 1 $710.59 $620.10 $188,869.71
14 2 $708.26 $622.43 $188,247.28
14 3 $705.93 $624.76 $187,622.52
14 4 $703.58 $627.10 $186,995.42
14 5 $701.23 $629.45 $186,365.96
14 6 $698.87 $631.82 $185,734.15
14 7 $696.50 $634.18 $185,099.96
14 8 $694.12 $636.56 $184,463.40
14 9 $691.74 $638.95 $183,824.45
14 10 $689.34 $641.35 $183,183.11
14 11 $686.94 $643.75 $182,539.36
14 12 $684.52 $646.16 $181,893.19
Totals for year 14 $8,371.63 $7,596.62 $181,893.19
15 1 $682.10 $648.59 $181,244.60
15 2 $679.67 $651.02 $180,593.58
15 3 $677.23 $653.46 $179,940.12
15 4 $674.78 $655.91 $179,284.21
15 5 $672.32 $658.37 $178,625.84
15 6 $669.85 $660.84 $177,965.00
15 7 $667.37 $663.32 $177,301.68
15 8 $664.88 $665.81 $176,635.87
15 9 $662.38 $668.30 $175,967.57
15 10 $659.88 $670.81 $175,296.76
15 11 $657.36 $673.32 $174,623.44
15 12 $654.84 $675.85 $173,947.59
Totals for year 15 $8,022.64 $7,945.60 $173,947.59
16 1 $652.30 $678.38 $173,269.20
16 2 $649.76 $680.93 $172,588.27
16 3 $647.21 $683.48 $171,904.79
16 4 $644.64 $686.04 $171,218.75
16 5 $642.07 $688.62 $170,530.13
16 6 $639.49 $691.20 $169,838.93
16 7 $636.90 $693.79 $169,145.14
16 8 $634.29 $696.39 $168,448.75
16 9 $631.68 $699.00 $167,749.74
16 10 $629.06 $701.63 $167,048.12
16 11 $626.43 $704.26 $166,343.86
16 12 $623.79 $706.90 $165,636.96
Totals for year 16 $7,657.62 $8,310.62 $165,636.96
17 1 $621.14 $709.55 $164,927.41
17 2 $618.48 $712.21 $164,215.20
17 3 $615.81 $714.88 $163,500.32
17 4 $613.13 $717.56 $162,782.76
17 5 $610.44 $720.25 $162,062.51
17 6 $607.73 $722.95 $161,339.56
17 7 $605.02 $725.66 $160,613.89
17 8 $602.30 $728.39 $159,885.51
17 9 $599.57 $731.12 $159,154.39
17 10 $596.83 $733.86 $158,420.53
17 11 $594.08 $736.61 $157,683.92
17 12 $591.31 $739.37 $156,944.55
Totals for year 17 $7,275.84 $8,692.41 $156,944.55
18 1 $588.54 $742.15 $156,202.41
18 2 $585.76 $744.93 $155,457.48
18 3 $582.97 $747.72 $154,709.76
18 4 $580.16 $750.53 $153,959.23
18 5 $577.35 $753.34 $153,205.89
18 6 $574.52 $756.17 $152,449.72
18 7 $571.69 $759.00 $151,690.72
18 8 $568.84 $761.85 $150,928.88
18 9 $565.98 $764.70 $150,164.17
18 10 $563.12 $767.57 $149,396.60
18 11 $560.24 $770.45 $148,626.15
18 12 $557.35 $773.34 $147,852.81
Totals for year 18 $6,876.51 $9,091.74 $147,852.81
19 1 $554.45 $776.24 $147,076.57
19 2 $551.54 $779.15 $146,297.42
19 3 $548.62 $782.07 $145,515.35
19 4 $545.68 $785.00 $144,730.34
19 5 $542.74 $787.95 $143,942.40
19 6 $539.78 $790.90 $143,151.49
19 7 $536.82 $793.87 $142,357.62
19 8 $533.84 $796.85 $141,560.78
19 9 $530.85 $799.83 $140,760.94
19 10 $527.85 $802.83 $139,958.11
19 11 $524.84 $805.84 $139,152.26
19 12 $521.82 $808.87 $138,343.40
Totals for year 19 $6,458.84 $9,509.41 $138,343.40
20 1 $518.79 $811.90 $137,531.50
20 2 $515.74 $814.94 $136,716.55
20 3 $512.69 $818.00 $135,898.55
20 4 $509.62 $821.07 $135,077.49
20 5 $506.54 $824.15 $134,253.34
20 6 $503.45 $827.24 $133,426.10
20 7 $500.35 $830.34 $132,595.76
20 8 $497.23 $833.45 $131,762.31
20 9 $494.11 $836.58 $130,925.73
20 10 $490.97 $839.72 $130,086.01
20 11 $487.82 $842.86 $129,243.15
20 12 $484.66 $846.03 $128,397.12
Totals for year 20 $6,021.97 $9,946.27 $128,397.12
21 1 $481.49 $849.20 $127,547.93
21 2 $478.30 $852.38 $126,695.54
21 3 $475.11 $855.58 $125,839.96
21 4 $471.90 $858.79 $124,981.18
21 5 $468.68 $862.01 $124,119.17
21 6 $465.45 $865.24 $123,253.93
21 7 $462.20 $868.49 $122,385.44
21 8 $458.95 $871.74 $121,513.70
21 9 $455.68 $875.01 $120,638.69
21 10 $452.40 $878.29 $119,760.40
21 11 $449.10 $881.59 $118,878.81
21 12 $445.80 $884.89 $117,993.92
Totals for year 21 $5,565.04 $10,403.20 $117,993.92
22 1 $442.48 $888.21 $117,105.71
22 2 $439.15 $891.54 $116,214.17
22 3 $435.80 $894.88 $115,319.28
22 4 $432.45 $898.24 $114,421.04
22 5 $429.08 $901.61 $113,519.44
22 6 $425.70 $904.99 $112,614.45
22 7 $422.30 $908.38 $111,706.06
22 8 $418.90 $911.79 $110,794.27
22 9 $415.48 $915.21 $109,879.07
22 10 $412.05 $918.64 $108,960.42
22 11 $408.60 $922.09 $108,038.34
22 12 $405.14 $925.54 $107,112.79
Totals for year 22 $5,087.12 $10,881.13 $107,112.79
23 1 $401.67 $929.01 $106,183.78
23 2 $398.19 $932.50 $105,251.28
23 3 $394.69 $936.00 $104,315.29
23 4 $391.18 $939.51 $103,375.78
23 5 $387.66 $943.03 $102,432.75
23 6 $384.12 $946.56 $101,486.19
23 7 $380.57 $950.11 $100,536.08
23 8 $377.01 $953.68 $99,582.40
23 9 $373.43 $957.25 $98,625.15
23 10 $369.84 $960.84 $97,664.30
23 11 $366.24 $964.45 $96,699.86
23 12 $362.62 $968.06 $95,731.79
Totals for year 23 $4,587.25 $11,381.00 $95,731.79
24 1 $358.99 $971.69 $94,760.10
24 2 $355.35 $975.34 $93,784.76
24 3 $351.69 $978.99 $92,805.77
24 4 $348.02 $982.67 $91,823.10
24 5 $344.34 $986.35 $90,836.75
24 6 $340.64 $990.05 $89,846.70
24 7 $336.93 $993.76 $88,852.94
24 8 $333.20 $997.49 $87,855.45
24 9 $329.46 $1,001.23 $86,854.22
24 10 $325.70 $1,004.98 $85,849.24
24 11 $321.93 $1,008.75 $84,840.48
24 12 $318.15 $1,012.54 $83,827.95
Totals for year 24 $4,064.40 $11,903.84 $83,827.95
25 1 $314.35 $1,016.33 $82,811.62
25 2 $310.54 $1,020.14 $81,791.47
25 3 $306.72 $1,023.97 $80,767.50
25 4 $302.88 $1,027.81 $79,739.69
25 5 $299.02 $1,031.66 $78,708.03
25 6 $295.16 $1,035.53 $77,672.50
25 7 $291.27 $1,039.42 $76,633.08
25 8 $287.37 $1,043.31 $75,589.77
25 9 $283.46 $1,047.23 $74,542.54
25 10 $279.53 $1,051.15 $73,491.39
25 11 $275.59 $1,055.09 $72,436.30
25 12 $271.64 $1,059.05 $71,377.25
Totals for year 25 $3,517.54 $12,450.70 $71,377.25
26 1 $267.66 $1,063.02 $70,314.22
26 2 $263.68 $1,067.01 $69,247.21
26 3 $259.68 $1,071.01 $68,176.20
26 4 $255.66 $1,075.03 $67,101.18
26 5 $251.63 $1,079.06 $66,022.12
26 6 $247.58 $1,083.10 $64,939.01
26 7 $243.52 $1,087.17 $63,851.85
26 8 $239.44 $1,091.24 $62,760.61
26 9 $235.35 $1,095.34 $61,665.27
26 10 $231.24 $1,099.44 $60,565.83
26 11 $227.12 $1,103.57 $59,462.26
26 12 $222.98 $1,107.70 $58,354.56
Totals for year 26 $2,945.56 $13,022.69 $58,354.56
27 1 $218.83 $1,111.86 $57,242.70
27 2 $214.66 $1,116.03 $56,126.67
27 3 $210.48 $1,120.21 $55,006.46
27 4 $206.27 $1,124.41 $53,882.05
27 5 $202.06 $1,128.63 $52,753.42
27 6 $197.83 $1,132.86 $51,620.56
27 7 $193.58 $1,137.11 $50,483.45
27 8 $189.31 $1,141.37 $49,342.07
27 9 $185.03 $1,145.65 $48,196.42
27 10 $180.74 $1,149.95 $47,046.47
27 11 $176.42 $1,154.26 $45,892.20
27 12 $172.10 $1,158.59 $44,733.61
Totals for year 27 $2,347.30 $13,620.95 $44,733.61
28 1 $167.75 $1,162.94 $43,570.68
28 2 $163.39 $1,167.30 $42,403.38
28 3 $159.01 $1,171.67 $41,231.70
28 4 $154.62 $1,176.07 $40,055.63
28 5 $150.21 $1,180.48 $38,875.16
28 6 $145.78 $1,184.91 $37,690.25
28 7 $141.34 $1,189.35 $36,500.90
28 8 $136.88 $1,193.81 $35,307.09
28 9 $132.40 $1,198.29 $34,108.81
28 10 $127.91 $1,202.78 $32,906.03
28 11 $123.40 $1,207.29 $31,698.74
28 12 $118.87 $1,211.82 $30,486.92
Totals for year 28 $1,721.56 $14,246.69 $30,486.92
29 1 $114.33 $1,216.36 $29,270.56
29 2 $109.76 $1,220.92 $28,049.64
29 3 $105.19 $1,225.50 $26,824.14
29 4 $100.59 $1,230.10 $25,594.04
29 5 $95.98 $1,234.71 $24,359.33
29 6 $91.35 $1,239.34 $23,119.99
29 7 $86.70 $1,243.99 $21,876.00
29 8 $82.04 $1,248.65 $20,627.35
29 9 $77.35 $1,253.33 $19,374.01
29 10 $72.65 $1,258.03 $18,115.98
29 11 $67.93 $1,262.75 $16,853.23
29 12 $63.20 $1,267.49 $15,585.74
Totals for year 29 $1,067.07 $14,901.18 $15,585.74
30 1 $58.45 $1,272.24 $14,313.50
30 2 $53.68 $1,277.01 $13,036.49
30 3 $48.89 $1,281.80 $11,754.69
30 4 $44.08 $1,286.61 $10,468.08
30 5 $39.26 $1,291.43 $9,176.65
30 6 $34.41 $1,296.27 $7,880.37
30 7 $29.55 $1,301.14 $6,579.24
30 8 $24.67 $1,306.02 $5,273.22
30 9 $19.77 $1,310.91 $3,962.31
30 10 $14.86 $1,315.83 $2,646.48
30 11 $9.92 $1,320.76 $1,325.72
30 12 $4.97 $1,325.72 $0.00
Totals for year 30 $382.51 $15,585.74 $0.00

An Introductory Guide to USDA Home Loans

Rural Landscape.

Probably the first thing that comes to mind when you think of the USDA might be food quality. Or maybe farming regulations. You might not be quick to associate the US Department of Agriculture with mortgages, grants or home improvement loans, but you could be missing out.

If you are looking for a mortgage or many other types of home improvement funding, you should be aware of the opportunities that the USDA has in place to help build up its rural communities. Though the USDA has many different programs that might interest a rural business, this article focuses on the home loan programs offered to qualified individuals.

What are USDA Loans?

USDA loans are loans that are subsidized by the federal government, offering a zero-down payment mortgage to qualified borrowers. These loans are not going to be applicable in any metropolitan areas but are meant instead to build up the rural communities outside of the busier city hubs.

Some suburban areas will be included in the coverage, but you will have to check with the official website to determine your own property’s (and therefore your own) potential eligibility.

There are three types of home loan programs currently offered by the USDA:

  1. Guaranteed: these loans are issued by a participating lender and backed by the federal government against default. These loans will offer low interest rates and can be offered with no money down as well, though a down payment could help you to avoid paying mortgage insurance (PMI).
  2. Direct: these are loans actually issued by the USDA state offices directly. Direct loan programs are meant to help low- and very low- income families with home ownership. There are restrictions on income, as well as on the property that is being purchased. Note that there can be additional subsidies and other benefits with direct loans to help otherwise struggling individuals and families.
  3. Home improvement loans and grants: while some of these are loans made with a local lender, some awards will be cash grants presented to improve a property. You also may be able to combine home improvement loans and grants to receive up to $27,500 to improve your property.

Guaranteed USDA Home Loan Programs

Guaranteed USDA loans are similar to VA or FHA loans, and can be compared as well to conventional or traditional loans. Where a VA loan would require military service, a USDA loan would require that the property is in a designated geographic area and the applicant is within any established parameters.

Guaranteed USDA loans do not have a ceiling on the amount you can borrow, unlike other governmental programs. Instead, they are more limited by the applicant’s income and the geographic region of the property – they are designed specifically to help people who do not qualify for other types of mortgages.

While it might seem that they would be aimed at farmers or to buy large rural properties, in actuality the guaranteed loan program of the USDA is focused on single family homes. You can find some multi-family units, condos or townhomes as well but restrictions on primary dwelling will apply.

Guaranteed USDA loans are fixed rate, usually for 15- or 30-year terms. If interested, you would find an approved USDA lender near you to begin the pre-approval process. The USDA maintains an updated list of both state and national approved lenders to guide you.

Direct Loans

USDA direct loans offer low- and very low-income families the means to secure a mortgage. These loans are obtained at each state’s USDA office, and parts of it can be subsidized to create a truly no-money-down offer for recipients.

Direct loans have much tighter requirements in income and the property being purchased. They regularly publish acceptable income levels for low-income and moderate-income loan programs, and programs and availability will certainly vary by location.

Additionally, direct loans are meant for smaller homes – 2,000 square feet or less. They are aimed at families struggling to find decent, safe and sanitary housing who cannot secure a traditional financing source and has an income below the local low-income limits.

The amounts available from USDA direct loans will vary by geography.

A good way to see more of what the USDA offers in your state, is to visit their single-family housing guaranteed loan program page, then sort by your desired state. You can find there a wonderful comparison of direct loans and guaranteed loans in your area, with side-by-side comparison charts of specific details, restrictions and benefits.

How USDA Loans Compare to Other Mortgages

In addition to comparing the USDA’s direct and guaranteed loans, it can also help to get a better understanding of how a USDA loan compares to other loan programs offered both by the government and by traditional loan products. A table can help that visually unfold, even when comparing it in the simplest terms:

Minimum credit score Minimum down payment Funding fee Monthly mortgage insurance
FHA n/a $ medium $ medium $ high
USDA n/a 0 $ low $ low
VA n/a 0 $ high 0
Traditional 680+ $ high 0 $ medium

Important to note, is that though certain loans with federal subsidizing will not require a down payment or minimum credit score by law, in reality, anyone funding your loan will be interested in both of these things. You can count on needing a minimum credit score of 640 to be able to push any agenda forward. You may or may not need a down payment, but you will need a decent credit score to secure any type of loan, generally speaking.

The down payment you make on your loan will affect how the terms play out over time, especially concerning PMI (mortgage insurance) – so the more that you can put down, the better your long-term results will be.

How much you can put down on a loan, matters. Your credit score also matters. These are the specifics you can control directly, so improving these details should remain your focus if you want to increase your opportunities.

What Constitutes Rural?

The idea of what one rural area is, compared to another area, is a subject of some debate. Regardless of anyone else’s definitions, the way the USDA looks at a rural area matters to whether or not you can receive any funding.

You can see what the government thinks here: https://www.nal.usda.gov/ric/what-is-rural.

“Rural encompasses all population, housing, and territory not included within an urban area.” While you could look at urban areas and subtract, it is easier to enter your information into the USDA website to see if your area is actually one that can work for USDA loans and grants.

The Long and Short of It

Ultimately, the question of whether or not USDA loans are the right fit for you, will be determined by answering honestly to two simple facts – where you live/want to buy, and how much you earn.

The fact that USDA loans can offer a simple and cost-effective loan product means nothing to you if the first two hurdles aren’t cleared. You MUST live in an approved area and MUST not exceed the base income levels outlined by the USDA programs.

USDA loans are meant as ways to bolster the economic growth of rural areas with people that would not have the same opportunities otherwise. This makes qualifying specific and sometimes difficult for otherwise streamlined borrowers. A USDA loan is not for everyone.

If you can qualify for another kind of loan, chances are good that you will not also qualify for a USDA loan. The government is using this program to empower rural areas and challenged borrowers, so it has very specific and limiting criteria to meet. However, if and when it does apply to you, you will happily find that USDA loans offer some of the best possible rates and terms of any mortgages currently available.