U.S. Department of Agriculture (USDA) mortgage loans are offered in rural areas to help lower-income households gain access to home loans at reasonable mortgage rates.

Property types eligible for USDA loans include single-family homes, condominiums and manufactured housing on a permanent foundation. Eligibility requirements vary depending on property location, and these loans are offered only to individuals whose income is below rural-development county limits based on the number of members in the household.

Important benefits of USDA mortgages include:

  • No money down, and up to 103.5% financing
  • Available for purchase and no-cash-out refinances of primary residences
  • Gifts and/or grants are allowed for closing costs
  • Borrower’s closing costs may be paid by the seller or financed into the loan amount
  • A funding fee eliminates the need for private mortgage insurance