Mortgage Guide

Loan types

USDA Loans, Explained

Published by the Mortgage Guide editorial team. Rate assumptions and content updated October 2026. This page is educational. It is not a loan offer, approval, or personalized financial advice.

Fees are assumptions

The upfront fee is financed in the model, so interest is charged on the base loan plus 1%. The annual fee is shown as a level monthly amount.

USDA has changed fees before. Confirm the current guarantee fee before comparing a real offer.

Location and income are the gate

A property inside a city can be ineligible even when the payment looks affordable. Income limits consider the household, not only the borrower on the note.

The calculator will still produce a payment if you type a price. That is not a finding.

USDA assumptions on this site
FeeFigure
Upfront1% of the base loan
Annual0.35%

Calculators

Related guides

Sources

Common questions

Is USDA only for farms?

No. Eligible areas include many small towns. The map and the income limits are USDA's, not ours.

Can I use the PMI calculator instead?

No. The guarantee fee is a different charge. Using PMI would describe the wrong program.