More Products, Better Service — NMLS #112844
A USDA loan is a zero-down-payment mortgage backed by the United States Department of Agriculture through its Rural Housing Service. The program was created to promote homeownership in rural and suburban communities that meet specific population thresholds.
Two types of USDA loans exist. Guaranteed loans are issued by approved private lenders like PierPoint Mortgage and backed by the USDA. Direct loans are funded directly by the USDA for very-low-income applicants. Most borrowers use the guaranteed loan program because it offers more flexible income limits and is available through standard mortgage lenders.
Despite the name, USDA-eligible areas are not limited to farmland. Many suburban communities, small towns, and exurban neighborhoods qualify. The USDA eligibility map is updated periodically, and some areas that seem suburban or even semi-urban are included in the program.
Your household income must not exceed 115% of the area median income for your county. All household members’ income is counted, not just the borrower’s.
The home must be in a USDA-designated rural area. Use the USDA eligibility map at rd.usda.gov to verify any address before making an offer.
Most USDA lenders require a minimum score of 640 for automated underwriting approval. Borrowers below 640 may still qualify through manual underwriting.
The property must serve as your primary home. Investment properties, vacation homes, and income-producing farms are not eligible for USDA financing.
Applicants must be U.S. citizens, qualified aliens, or non-citizen nationals with valid government-issued identification.
The home must have adequate utilities, road access, and meet USDA minimum property requirements. Most single-family homes under 2,000 square feet in eligible zones qualify.
Verify that the property address falls within a USDA-eligible area and that your household income meets the 115% limit for your county.
Submit income documentation, identification, and credit authorization to PierPoint Mortgage for a USDA pre-approval assessment.
Work with your agent to identify homes in USDA-designated zones that meet the program’s property condition requirements.
Complete the loan application with full documentation including tax returns, pay stubs, bank statements, and proof of citizenship.
A certified appraiser evaluates the property for value and condition. The file is then submitted to USDA for their underwriting review.
After USDA approval, finalize the transaction at the closing table with zero down payment and begin enjoying your new home.
USDA loans offer 100% financing, meaning no down payment is required. This is one of only two major loan programs (along with VA) that allow zero-down purchases.
The USDA guarantee fee (1% upfront and 0.35% annually) is significantly less than FHA mortgage insurance premiums, saving hundreds per year.
USDA loan interest rates are often 0.25% to 0.50% lower than conventional rates because the government guarantee reduces lender risk.
Manual underwriting is available for borrowers with limited credit history or scores below 640, considering alternative credit sources like rent and utility payments.
Closing costs can be financed into the loan if the appraised value exceeds the purchase price, or the seller can contribute up to 6%.
USDA loans are purpose-built for moderate-income families who want to buy a home in a rural or suburban community without saving for a large down payment. If your household income falls within the county limits and you want to live outside of major metropolitan centers, this program offers unmatched affordability.
First-time and repeat homebuyers both qualify. There is no first-time buyer requirement, and you can use the program even if you have owned a home before, as long as you do not currently own adequate housing.
Borrowers with limited savings benefit the most because the zero-down structure means your only upfront cost is closing fees, which can often be rolled into the loan or covered by seller contributions. Combined with below-market interest rates, USDA loans produce some of the lowest monthly payments available in today’s mortgage market.
USDA-eligible areas include rural communities and many suburban neighborhoods outside major metro centers. Areas with populations under 35,000 typically qualify. You can check any address instantly using the USDA property eligibility map at rd.usda.gov.
Correct. USDA guaranteed loans require zero down payment. The entire purchase price can be financed. If the appraisal comes in higher than the purchase price, you can even finance your closing costs into the loan.
Your total household income cannot exceed 115% of the median household income for your county. This includes income from all adult household members, even those not on the loan. Limits vary significantly by county and household size.
Yes, if the manufactured home is permanently affixed to a foundation on USDA-eligible land, meets HUD standards, and was built after June 15, 1976. The land and home must be financed together.
USDA loans add an extra step because the file must be reviewed by the USDA after your lender’s underwriting. This typically adds 1 to 2 weeks, making total closing time around 45 to 60 days.
PierPoint Mortgage is licensed and lending in Alabama, Colorado, Connecticut, Florida, Georgia, Louisiana, Michigan, Mississippi, New York, North Carolina, Ohio, Oregon, Pennsylvania, and Washington.
View All Service Areas →
Speak with an experienced PierPoint Mortgage loan officer today. We will help you find the right loan for your goals and guide you through every step of the process.
NMLS #112844
Refinance your existing mortgage to reduce your monthly payment.
Disclosure: By refinancing your existing loan, your total finance charges may be higher over the life of the loan. PierPoint Mortgage, LLC • NMLS ID #112844 • nmlsconsumeraccess.org
3088 Sheffield St. STE BMuskegon, MI 49441
(844) 241-7720
shannon@pierpointmortgage.com
NMLS Consumer Access
© 2026 PierPoint Mortgage LLC - NMLS #112844
