USDA Frequently Asked Questions (FAQ)

What type of credit is needed to obtain a USDA Home Loan?

A USDA Home Loan has flexible credit guidelines and currently lends down to a 620 credit score.
If you have insufficient credit on your credit report, alternative credit can be utilized. Alternative credit are accounts like auto insurance, cell phone bill, cable bill, rent verification, electric bill, etc…

Do I have to be a first time home buyer to qet a USDA Home Loan?

You do not need to be a first time home buyer, however, the new home must be your primary residence.

  • If you currently own a stick built home and want to upgrade to a new home, there are certain parameters that must be met to obtain a USDA Home Loan.
  • If you currently own a mobile home or manufactured home and classified as personal property, you may still be eligible to obtain a USDA Home Loan to purchase a stick built home.

Is there really no down payment on a USDA Home Loan?

That is correct! There is no down payment required on the USDA Home Loan which is the key benefit that separates this loan program from others.

Are there any upfront or application fees?

There are no application fees or anything that you have to pay upfront to us to get your loan, however there are some required inspections that you will need to get on the home that you will be responsible for, such as:

  • Appraisal Fee (Typically $450-$500)
  • Termite Inspection (Typically $75-$125)

If the property has a water well for it’s water source, you will also need to obtain a well water test to ensure water is safe to drink. There is an additional fee for a water test to be administered by a local water testing facility.

What is the maximum debt ratio allowed on a USDA Loan?

Your credit score will determine the max debt ratio allowed.


  • If you have a 640 credit score or higher, the max debt ratio is 50%.
  • If you have a 620 to 639 credit score, the max debt ratio allowed is 41%.