USDA Home Loans & Current USDA Mortgage Rates

USDA Loan Calculator (Guarantee Fee Included)

Model a USDA purchase with 0% down or a custom down payment. We include a practical estimate of the USDA upfront guarantee fee and the annual fee so you can see a more realistic monthly housing payment.

Note: Guarantee fee percentages can change. This calculator provides a planning estimate based on common program settings and does not replace a lender’s official loan estimate.

Compare Current USDA Mortgage Rates

Compare USDA mortgage rates from lenders. Rates change daily and your final APR depends on credit, fees, lock period, and underwriting.

What Is a USDA Home Loan?

The USDA Rural Development loan program is designed to expand homeownership opportunities in eligible rural and suburban communities. Most borrowers use the USDA Guaranteed Loan, which is issued by approved lenders and backed by a USDA guarantee.

• 0% down: USDA allows 100% financing for eligible buyers.
• Fixed-rate terms: Most USDA borrowers use a 30-year fixed loan.
• Guarantee fees: Upfront and annual fees help fund the program.
• Primary residence: The home must be owner-occupied.

Unlike conventional loans that may require PMI with a low down payment, USDA uses a guarantee fee model. In many cases, the annual fee can be lower than FHA mortgage insurance, depending on your scenario.

USDA Property Eligibility Requirements (Rural Map Rules)

A USDA loan requires the property to be in an eligible area. Despite the “rural” label, many suburban communities qualify. Eligibility is based on population density and proximity to major metros.

• Location: Must fall within a USDA-eligible area.
• Use: Must be your primary residence.
• Property type: Typically single-family homes; some condos may qualify.
• Condition: Must meet basic habitability standards.

If you’re unsure, check the address on the USDA eligibility map or ask a lender to confirm before making an offer.

USDA Income Limits and Household Income Rules

USDA loans have income limits that vary by county and household size. A key difference vs FHA or conventional loans is that USDA typically considers total household income, not just the income of the borrowers on the mortgage.

USDA also allows certain deductions (for example, dependents or childcare) to calculate an adjusted income number. Because the rules are location-specific, the fastest path is to check your county’s USDA limit and confirm with a lender.

USDA Guarantee Fee Explained (Upfront + Annual)

USDA loans don’t use monthly PMI, but they do include a guarantee fee structure:

• Upfront guarantee fee: Often modeled around 1% of the base loan. Many borrowers finance it into the loan amount.
• Annual fee: Often modeled around 0.35% of the outstanding balance, paid monthly as part of your payment.

In our calculator above, you can toggle whether to finance the upfront fee or pay it at closing. Financing increases your loan amount and P&I, while paying it upfront increases your cash needed at closing.

USDA Qualification Requirements

USDA underwriting is often considered flexible, but lenders still review credit, income, and debt. Many lenders look for a 620+ credit score for streamlined processing, though exceptions can exist with compensating factors.

• Credit: Strong payment history and acceptable score for the lender.
• DTI: Often targets around 41%, with possible exceptions.
• Stable income: Typically a 2-year employment history helps.

USDA vs FHA vs Conventional: Which Is Better?

For eligible buyers, USDA can be one of the lowest cash-to-close options. FHA can be easier in some credit scenarios but requires 3.5% down and mortgage insurance. Conventional can be best with strong credit and a larger down payment.

• Down payment: USDA (0%), FHA (3.5%), Conventional (3–20%)
• Mortgage insurance: USDA uses fees; FHA uses MIP; conventional uses PMI under 20% down
• Limits: USDA has income + area rules; FHA/conventional generally don’t

If you want to compare affordability across programs, start with our mortgage payment calculator and then compare offers in the rate tables.

USDA Loan FAQs