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.
The purchase price can be fully financed — your cash still covers costs around the loan.
On a qualifying USDA purchase, you can finance 100% of the home’s price. No 3% or 3.5% down payment is required when the file and property qualify.
Title, lender fees, prepaid taxes/insurance, and escrow setup usually require cash — unless credits or gifts cover them.
The ~1% USDA upfront guarantee fee is commonly rolled into the loan so you do not write a separate check for it.
USDA’s annual guarantee fee (~0.35%) is typically lower than FHA MIP and replaces traditional PMI on this program.
Eligible location, household income limits (~115% AMI), credit, and owner-occupancy still apply — zero down is not a free pass.
Zero down handles the purchase price. These moves often decide how much you bring on closing day.
No down payment does not mean light paperwork.
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 |
Related guides to help you compare options and move toward pre-approval.
2MG Daily
Recent articles from our blog on USDA loans, rural eligibility, and zero-down financing.
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Yes. USDA Guaranteed loans allow 100% financing — $0 down payment — when the property is in an eligible area, your household income is within limits, and the rest of the file qualifies.
Not usually. You still need to cover closing costs, prepaid items (taxes, insurance), and earnest money unless seller credits, lender credits, or gifts offset those amounts.
Yes. The one-time upfront guarantee fee (currently about 1%) is commonly financed into the loan so you do not pay it in cash at closing.
USDA can finance the full purchase price with no down payment; FHA typically requires 3.5% (or 10% with lower credit). USDA also uses a guarantee fee that is often lower annually than FHA MIP, but only in eligible locations with income limits.
We will check property eligibility, income limits, and your true cash to close — then get you pre-approved so you can shop with confidence.