USDA Loans for First-Time Buyers

Buying your first home can be overwhelming. Using a program designed for you first home purchase can help.

No Down Payment Required

USDA loans are one of the few loan programs that allow a borrower to put nothing down. USDA loans can offer 100% financing because they are backed by the U.S. government. The USDA guarantee provides lenders a safety net in case the borrower defaults on the loan. Because of this decreased risk to lenders, USDA home loans offer 100% financing and low interest rates.

This feature has helped many people access homeownership who otherwise would not have been able to purchase a home. It’s especially helpful for first-time home buyers who might be struggling to come up with a down payment.

Low Interest Rates

In addition to zero percent down, eligible borrowers will also benefit from low interest rates. Once again, this has to do with the loans being backed by the USDA. With much of the lending risk removed, banks and mortgage companies can offer lower rates to home buyers. USDA loans have some of the lowest rates available compared to conventional or FHA loans.

Who is Eligible?

First-time home buyers should understand that USDA loans have certain eligibility requirements. To qualify for a USDA loan, home buyers must:

  • Purchase a home in a USDA-eligible area
  • Have a preferred minimum credit score of at least 640
  • Meet the income limits for the area
  • Occupy the dwelling as a primary residence
  • Be a U.S. citizen, U.S. non-citizen national or qualified alien

Apply for a USDA Loan

To help determine what you can afford, use our mortgage calculator. With access to real-time rates, you can customize your information and get an accurate snapshot of what your monthly payment might be.