For eligible suburban and rural home buyers, the USDA Rural Development Guaranteed Housing Loan, USDA loan, is a 100%, no-money down mortgage loan. The program is available in 97% of the geographic United States. USDA loans are insured by the U.S. Department of Agriculture and the program's biggest feature is its option for "no money down" financing.
With a USDA loan, you don't have to make a downpayment; and you're required to take a fixed rate loan. ARMs aren't available via the USDA program. USDA loans can be used by first-time buyers and repeat home buyers alike. Homeowner counseling is not required to use the USDA program.
USDA mortgage rates are often the lowest compared to other programs such as FHA mortgage rates, VA mortgage rates, and conventional loan mortgage rates.
With the USDA Rural Housing Program, your home must be located in a rural area. There is no maximum loan size for the USDA loan program. The amount you can borrow is limited by your household's debt-to-income. Your annual income is limited. The USDA Rural Housing Program is for primary residences only.
No down payment requirement for qualified borrowers
Debt-to-income ratio 29/41
Minimum FICO 550
No cash reserve requirements
Seller can pay closing costs and pre-paids (some restrictions apply)
Purchase, Rate/Term Refinance and Streamline Refinance available