Some people prefer to have a home surrounded by pastures than pavements. They feel more at home when they are one with nature. If you are one searching for that kind of house, the U.S. Department of Agriculture mortgage program is right for you. The USDA Home Loans must be a least-known mortgage assistance programs by the government.

This program has a zero down payment mortgage and eligible for rural and suburban homebuyers. It is designed to improve the economy and quality of life in rural America. The loans are issued through USDA Home Loans program, known as the USDA Rural Development Guaranteed Housing Loan Program, by the United States Department of Agriculture. It offers low-interest rates, and you are in for a surprise to find just how easily accessible it is.

How it Works

USDA guarantees a mortgage issued by a local lender. If you have no down payment or just put a little money down, you will have a mortgage insurance premium to pay. Direct loans are for low-and very low-income applicants. It will vary by regions, and its interest rates can be as low as 1%. They also have home improvement loans and grants that permits homeowners to upgrade or repair their homes. The packages can combine a grant and a loan which provides $27500 in assistance.

Funds can be used for new or existing residential property to be used as a permanent residence. Closing cost may be included in the transaction. It can also be used to a site with a new or existing dwelling and for repairs and rehabilitation when associated with the current dwelling purchase. Even for refinancing of eligible loans. It can be used for unique design features or for permanently installed equipment to accommodate a household member which has a physical disability. Even for site preparation costs, including grading, fences and driveways, foundation plantings, and seeding or sod installation fees.


The income limits to qualify for the home loan guarantee vary in location and household size. You can consult the USDA map for it. They can fund only those owners who occupied primary residences. They must have U.S. citizenship, a monthly payment of 29 % or less of the monthly income and reliable income for a minimum of 24 months.

You must have an acceptable credit history, no accounts converted to the collection in the last 12 months. You may still qualify if you can prove that your credit was affected by outside of your control and circumstances, emergency and the like. You will receive streamlined processing if your credit score is 640 or higher.

The USDA issues mortgages to those who are deemed to have the most significant needs. One will be if they don’t have decent, safe and sanitary housing. They are unable to secure a home loan through traditional sources. They have an adjusted income at or below 2,000 square feet or less, and their market value is below the area loan limit.

If you think you are eligible for USDA home loans, contact to a participating lender, near you.

By Genaro Martin

Linda Martin: Linda, a renowned management consultant, offers strategies for leadership, team building, and performance management in her blog.