USDA (Rural Development/Guaranteed 502)

The United States Dept of Agriculture guarantees the RD502 Loan but does not make the loans. (similar to VA) – (guarantees the loan at 100 percent of the loss for the first 35 percent of the original loan amount and the remaining 65 percent at 85 percent of loss) Watch our informative Video Class on USDA Financing

  • Was begun in 1991 for Moderate Income families who could afford a mortgage payment but didn’t have the downpayment
  • Income Limits and Geographic Limits apply from County/MSA to County/MSA depending on no# of persons in Household.
  • Offers 100% financing, zero downpayment
  • Upfront USDA Guarantee Fee (2.00%) is funded with the Loan
  • 30yr fixed programs only
  • Purchase and Refinance – But Refinance only for existing USDA Loans being refinanced
  • Borrowers cannot presently own “adequate” housing
  • Typical minimum Credit Score = 620 (640 for more flexible Underwriting)
  • For homes which will be owner occupied only
  • Eligible Properties include Condos, Townhomes, as well as Single Family dwellings (Manufactured Homes only if brand new/never lived in)
  • Seasoning Rules Since Past Derogatory Credit Events for USDA Loans: (i.e. since Foreclosure, Bankruptcy, Short Sale) See informative Video at