A USDA loan is a home loan program backed by the U.S. Department of Agriculture (USDA) that helps people buy homes in rural and some suburban areas — with no down payment required and low interest rates.

It’s designed to make homeownership more affordable for low- to moderate-income borrowers in eligible communities.

Key Features of a USDA Loan

• 0% Down Payment: You can finance 100% of the home’s price — no down payment needed.
• Low Interest Rates: Because it’s backed by the USDA, lenders can offer below-market rates.
• Flexible Credit Guidelines: You don’t need perfect credit to qualify; most lenders look for a 640+ score, but exceptions can be made.
• Location-Based: The home must be in a USDA-eligible area, which includes many smaller towns and rural regions (and some outer suburban areas too).
• Income Limits: Your household income must fall within the USDA’s income limits for your area.