A USDA home loan is a zero-down payment mortgage for eligible rural and suburban homebuyers. These loans are issued through a private lender, such as a community bank, and guaranteed by the USDA Rural Development Guaranteed Housing Loan Program. This program is to help lenders work with low and moderate-income families living in eligible rural areas become homeowners.
- Single-family homes
- Meet income and property eligibility
- Must agree to occupy the dwelling as their primary residence
- Minimum credit score for borrower must be 640+
- Front end ratio is 29/back end 41
- Must finance an upfront mortgage insurance premium (UFMIP) of 1.00% of total loan amount and pay monthly mortgage insurance (MMI) at a maximum of .35% of loan amount annually
- Not been suspended or debarred from federal program participation
- Demonstrate willingness to meet credit obligations
Requirements set by the U.S. Department of Agriculture include:
- USDA specifies that funds backed by loan guarantees must be used for:
- New or existing residential property to be used as a permanent residence. Closing costs and reasonable/customary expenses associated with the purchase may be included in the transaction.
- Site with new or existing dwelling
- Refinancing of eligible loans
- Must be an eligible property. To find out if property qualifies for this loan visit: https://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=sfp
All loans subject to credit approval