Today's USDA Loans Rates
USDA loans are zero-down-payment mortgages backed by the U.S. Department of Agriculture for homes in eligible rural and suburban areas. With no down payment required and lower mortgage insurance costs than FHA, USDA loans are one of the most affordable paths to homeownership for income-eligible buyers.
* Estimated monthly payment based on a $400,000 loan amount. Assumes Rates assume 780+ credit, 75% LTV, primary residence, single-family home.. Your actual rate and payment may differ. Subject to credit approval.
What Is a USDA Loan?
A USDA loan is a mortgage program run by the U.S. Department of Agriculture's Rural Development division, designed to encourage homeownership in rural and suburban communities. The program offers 100% financing (zero down payment), below-market interest rates, and reduced mortgage insurance compared to FHA loans. Despite the name, USDA-eligible areas aren't limited to farmland — about 97% of U.S. land area qualifies, including many suburban neighborhoods just outside major cities.
Who Qualifies?
USDA loan eligibility has two primary requirements: location and income. The property must be in a USDA-designated eligible area (check the USDA eligibility map or ask CMS Mortgage to verify). Your household income must not exceed 115% of the area median income — for a family of four, this ranges from approximately $91,000 to over $150,000 depending on location. You'll need a credit score of 640 or higher for most lenders, a stable employment history, and a debt-to-income ratio below 41%.
Pros and Cons
Advantages
- ✓Zero down payment — 100% financing available
- ✓Lower mortgage insurance than FHA (0.35% annual vs. 0.55%+ for FHA)
- ✓Competitive interest rates — often below conventional and FHA rates
- ✓No maximum purchase price limit (must meet area income limits)
- ✓Closing costs can be financed or paid by the seller
- ✓No cash reserves required
Considerations
- ✗Property must be in a USDA-eligible rural or suburban area
- ✗Household income limits apply (115% of area median income)
- ✗Cannot be used for investment properties or second homes
- ✗Upfront guarantee fee of 1% of the loan amount
- ✗Annual guarantee fee of 0.35% required for the life of the loan
- ✗Processing times may be longer due to USDA approval requirements
How to Apply
Start by checking whether your desired area is USDA-eligible — CMS Mortgage can verify this instantly. Next, confirm your household income falls within the limits for your county. From there, the application process is similar to other mortgage types: provide two years of tax returns, pay stubs, bank statements, and identification. CMS Mortgage handles the USDA-specific paperwork, including the agency's conditional commitment process. We'll guide you through each step to make the process smooth.
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