USDA Guide
Are USDA Loans Really Zero Down?
Yes — USDA Guaranteed loans allow $0 down payment on eligible primary homes. Zero down is real; “zero cash to close” is not. Here is what that distinction means for your offer.
What “Zero Down” Actually Means
The purchase price can be fully financed — your cash still covers costs around the loan.
Ways to Lower Cash to Close
Zero down handles the purchase price. These moves often decide how much you bring on closing day.
- Negotiate seller-paid closing costs within USDA concession limits
- Compare lender credits vs. a slightly higher rate
- Finance the upfront guarantee fee into the loan
- Use eligible gift funds for closing costs or prepaid items
- Ask us for a full cash-to-close worksheet before you offer
What You Still Need to Document
No down payment does not mean light paperwork.
- Property eligibility in a USDA-approved area
- Household income within current area limits
- Source of earnest money and any gift funds
- Credit and DTI that clear lender overlays
- Owner-occupancy for a primary residence
Zero Down vs. Other Low-Down Options
When cash is tight, compare the full picture — not just the down payment line.
| Feature | USDA | FHA | Conventional |
|---|---|---|---|
| Min. down | $0 | 3.5% | 3% |
| Location rules | Eligible rural/suburban areas | Most areas | Most areas |
| Mortgage insurance / fee | Guarantee fee (lower annual) | MIP (often life of loan) | PMI (cancellable) |
| Income limits | Yes (~115% AMI) | No program income cap | No program income cap |
Keep Exploring
Related guides to help you compare options and move toward pre-approval.
What Is a USDA Loan?
How the USDA Guaranteed program works end to end.
USDA Loans Overview
Requirements, calculator, and program details.
Buy With 3.5% Down (FHA)
Compare USDA’s $0 down path with FHA’s 3.5% option.
First-Time Homebuyer Programs
Low- and zero-down options if this is your first purchase.
2MG Daily
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Frequently Asked Questions
Get Pre-Approved With $0 Down
We will check property eligibility, income limits, and your true cash to close — then get you pre-approved so you can shop with confidence.