Your zero-down USDA payment, with the 1% guarantee fee financed into the loan and the 0.35% annual fee priced for life.
USDA is the only program that lets the loan run above 100% of the home value, because the 1% upfront guarantee fee is normally rolled in. This calculator amortizes that financed fee, charges the 0.35% annual fee on the declining balance the way USDA actually does, prices financing the fee against paying it in cash, and checks your household income against the 115% of area median cap.
The eligibility row checks income only, against 115% of the area median you entered. USDA also requires the property itself to sit in an eligible rural or suburban area, which has to be looked up by address on the USDA eligibility map. This is a planning estimate, not an official eligibility determination.
Financing the fee is the norm, and USDA is the one program that lets the loan exceed 100% of the home's value to do it. It is not free: $2,800 added to the balance costs $3,571 in interest over 30 years.
USDA charges the annual fee on the average unpaid balance, so the monthly slice shrinks as you pay down, from $82 in year 1 to $3 in the final year. It never cancels the way conventional PMI does: over 30 years it adds up to $19,422.
Direct answers to the most common questions, in plain language. Skim if you're in a hurry; dig deeper below.
P&I on 101% of the price, plus the 0.35% annual fee, taxes, and insurance.
USDA finances 100% of the purchase price, then normally adds the 1% upfront guarantee fee on top, so the loan starts above the home's value. On a $280,000 home at 6.5% over 30 years you amortize $282,800: about $1,787 in principal and interest, $82 for the annual guarantee fee, plus property tax and insurance.
Usually financed, and USDA lets the loan exceed 100% of the value to do it.
Almost every USDA borrower rolls the 1% fee into the loan, which is why zero-down really means zero out of pocket. It is not free: on a $280,000 loan the $2,800 fee costs roughly $3,571 in extra interest over 30 years. This calculator prices both choices side by side so you can decide.
The life of the loan. It never auto-cancels the way PMI does.
The annual guarantee fee is charged on the average unpaid balance and billed monthly, so the slice shrinks as you pay down, but it runs for the full term. Over 30 years on a $282,800 loan that is roughly $19,400 on top of the upfront fee. Refinancing to a conventional loan once you have 20% equity is the usual exit.
The cap is 115% of the area median income for your household.
Enter your total household income and your area median income and the calculator shows a pass or fail against the 115% cap. A $90,000 area median puts the limit at $103,500. It is an income check only: the property itself must also sit in an eligible area, which you verify by address on the USDA eligibility map.
The mechanics in short answers. No jargon, no upsell.
A private lender (bank, credit union, mortgage company) issues the loan. The USDA guarantees a portion of it; that's why no down payment is needed.
A 1% upfront guarantee fee (rolled into the loan) and a 0.35% annual fee paid monthly. Together they're cheaper than FHA mortgage insurance.
Household income capped at 115% of the area median. The limit is generous in expensive areas: a family of 4 can earn $110k+ in many counties.
Despite the name, USDA-eligible areas include most suburbs, exurbs, and small towns, not just farmland. Check the USDA eligibility map for the exact address.
Worked example: A $280,000 home with $0 down finances $282,800 after the 1% fee, so the loan starts at 101% of the home value. At 6.5% over 30 years, P&I is about $1,787; adding the $82/mo USDA annual fee, $257/mo property tax (1.1%) and $117/mo insurance brings the total to roughly $2,243/mo. The annual fee slice falls to about $3/mo by the final year and totals around $19,400 over the term.
Uses the current USDA guarantee fee rates: 1% upfront (financeable above 100% of the home value) and 0.35% annual on the average unpaid balance, for the life of the loan. The income check compares your household income with 115% of the area median you enter; it is a planning estimate, not an official determination, and the property must also sit in a USDA-eligible area, which you verify by address on the USDA eligibility map. Everything runs locally in your browser.
Designed so anyone can model their situation in under a minute, with or without a finance background.
No down payment required; it is the only zero-down option besides VA.
0.35% annual fee vs 0.55% on FHA saves real money over time.
Full payment includes taxes, insurance, and the USDA annual fee.
No traditional mortgage insurance, just the USDA fees, which cancel sooner.
Quick yes/no on income and area limits before applying.
Year-by-year balance, interest paid, and equity built.
Everything you might ask before, during, or after using this tool.
USDA is zero-down with a 0.35% annual fee; FHA needs 3.5% down with a 0.55% annual fee. USDA has income and area limits; FHA doesn't. USDA fees are lower over the life of the loan but eligibility is more restrictive.
USDA technically has no minimum credit score, but most lenders require 640+. Below that, expect to need compensating factors (lower DTI, larger reserves) or a manual underwriting pass.
Yes: USDA offers a streamlined refinance program for existing USDA borrowers, plus standard refinances for those moving from a non-USDA loan into one. Eligibility for the home and your income still apply.
No, the "USDA" name is misleading. The Section 502 Guaranteed Loan program is for primary residences in USDA-designated areas, which include most rural and many suburban locations. Farming has nothing to do with eligibility.
A one-time 1% of the loan amount, typically financed into the loan (so you don't pay out of pocket). On a $300k home, that's $3,000 added to your principal. The fee can be paid in cash to avoid financing.
The 0.35% annual fee continues for the life of the loan, unlike conventional PMI which drops off at 78% LTV. Many borrowers refinance to conventional once they hit 20% equity to escape the fee.
115% of area median income for the household size. In 2026, that's roughly $103,500 for a 1–4 person household in average areas and up to $137,000 in higher-cost counties. The USDA income lookup tool gives the exact number by ZIP.
Generally no: USDA loans are for single-family primary residences only. Some condos and PUDs qualify if approved by USDA. Two-to-four-unit properties don't.
Other Lazysmirk tools that pair well with this one.
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Plan your home down payment: how much you need, how long to save, PMI tradeoffs.
If you're buying a primary home in a town under 35k people (or many suburbs of bigger cities), and your household earns at or below 115% of the area median, USDA is probably the cheapest path to a mortgage.
The combination of zero down and lower fees beats FHA materially when you qualify.
Despite the rural-development branding, USDA eligibility covers a huge swath of suburban America. Many towns just outside major metros (Austin, Denver, Charlotte, Raleigh) have USDA-eligible neighborhoods.
Always check the official map before assuming you don't qualify by location; most buyers are surprised at the coverage.
Upfront: USDA 1% vs FHA 1.75%. Annual: USDA 0.35% vs FHA 0.55%. On a $250k loan over 10 years, USDA saves roughly $5–8k.
The trade: FHA has no income or area limits, USDA does. If you qualify for USDA, take it.
USDA's annual fee never auto-cancels. Once you reach 20% equity in your home (through appreciation + paydown), refinancing to a conventional loan kills the fee.
That equity threshold typically arrives in years 5–7 of a USDA loan. Watch for the refi window.
Two short notes worth reading before you trust any number on this page.
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