USDA loans: often $0 down in eligible areas
A USDA Guaranteed Rural Housing loan helps eligible buyers purchase a primary home in a USDA-approved area with no down payment. Household income must fall under USDA limits for the county and household size. Many properties still qualify even if they do not feel "rural," so always check the address.
NMLS #1660690 · Reviewed by UMortgage+
Key facts
Figures below are typical industry education ranges. Exact overlays, credit floors, CLTVs, and timelines change—confirm with a loan officer against current NEXA Lending guidelines and your scenario.
| Minimum down payment (typical) | Often 0% (100% financing) on eligible purchase transactions. |
|---|---|
| Property location | Must be in a USDA-eligible area (verify by address). |
| Income limits | Household income capped by county and household size—confirm current charts for your county. |
| Credit / DTI | Lender overlays apply; automated underwriting evaluates credit and debts. |
| Guarantee fees | Upfront + annual USDA fees (not the same as FHA MIP). Often financable. |
| Occupancy | Primary residence. |
Who it's best for
- Buyers in USDA-eligible locations who want $0 down
- Households within USDA income limits
- First-time and repeat buyers purchasing a primary home
Who should look elsewhere
- Properties outside USDA maps
- Households over income limits
- Investment purchases or ineligible property types
- Buyers who need jumbo loan amounts above program caps
Pros and cons
Pros
- Often $0 down
- Competitive option vs. FHA for eligible borrowers
- Primary-home path with guarantee-fee structure instead of traditional PMI
Cons
- Property must map as eligible
- Income caps can disqualify higher earners
- Guarantee fees still add cost
- Fewer property-type options than conventional
How it works in 4 steps
Discovery or apply
Share goals, credit picture, property, and timing. We check which product path fits.
Compare scenarios
See payment, cash to close or draw amount, and trade-offs before you choose.
Underwriting / automation
We clear conditions—or, on automated equity products, complete e-sign and verification steps.
Close & fund / draw
Sign documents, fund the loan, and (for HELOC) start using your line when available.
Illustrative payment on a $300,000 USDA purchase ($0 down)
Assume $300,000 price, $0 down, loan ≈ $300,000 before any financed guarantee fee. At a sample note rate of 6.5% (placeholder only): P&I ≈ $1,896/month before taxes, insurance, and USDA annual fees.
On $400,000 at $0 down and the same sample 6.5%: P&I ≈ $2,528/month before taxes, insurance, and fees.
Not a rate quote, APR disclosure, or commitment to lend. Actual rates, caps, fees, and payments depend on credit, occupancy, property, index, margin, lock period, and market conditions. Ask a loan officer for a personalized Loan Estimate or HELOC/HELOAN disclosure.
Frequently asked questions
Which areas qualify for USDA?
USDA eligibility is based on the property address, not just "rural" stereotypes. Many suburban zip codes still qualify. Check a specific address with a loan officer or the USDA property eligibility map before you write an offer.
What are USDA income limits?
USDA sets household income limits by county and household size. Limits are updated periodically. Your LO will check the current limit for your county against everyone who will live in the home.
Is USDA really zero down?
The Guaranteed Rural Housing purchase program is designed for 100% financing (0% down) when you qualify. You still need a plan for closing costs—seller credits, gifts, or lender credits may help within guidelines.
USDA vs. FHA vs. conventional—when does USDA win?
USDA often wins when the property is in an eligible area, household income fits the limit, and you want $0 down with competitive pricing. FHA or conventional may win if the property is not USDA-eligible, income is over the cap, or you need a condo/occupancy type USDA does not allow.
Do USDA loans have mortgage insurance?
USDA charges an upfront guarantee fee and an annual fee (structure differs from FHA MIP / conventional PMI). Fees can often be financed. Confirm current fee percentages with your Loan Estimate.
Can I use USDA for a condo, multi-unit, or investment property?
USDA Guaranteed purchase loans are for eligible primary residences. Condos, manufactured homes, and 2–4 units have extra rules and are not always allowed. Investment property is not the purpose of this program.
Educational content only. Guidelines change. Confirm details with UMortgage+ powered by NEXA Lending, LLC, before you apply.
Check if your address qualifies for USDA
a loan officer will verify map eligibility and income limits. Call (480) 233-7897.