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USDA loans are great options for borrowers who don't have the money for a down payment.
These mortgages are backed by the United States Department of Agriculture. They're available to low-to-moderate income borrowers who live in eligible rural and suburban areas. You can use the USDA's property search tool to see if a home you're looking at is in an eligible area.
USDA loans require no down payment and often have better interest rates compared with conventional loans.
To find the best USDA loan lenders, Business Insider looked for mortgage lenders that offer affordable features on their loans, such as flexible credit guidelines or the ability to apply with non-traditional credit (like rent payment history).
These are the best USDA loan lenders of 2024 according to Business Insider editors.
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Recommended CreditFairway Independent Mortgage Corporation is a great option for borrowers who want a convenient experience from a lender that ranks high in customer satisfaction. It was also one of the top originators of USDA loans in 2023, according to the USDA.
Fairway Independent has an easy-to-navigate website and a hybrid closing option, making it an extremely convenient USDA lender to work with. Plus, in J.D. Power's 2023 Mortgage Origination Satisfaction Study, Fairway Independent earned the No. 1 spot, making it a good choice if customer service is important to you.
What to look out for: You may need a score of 640 or 660 to qualify for a USDA loan with this lender, but it depends on your overall financial profile.
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Recommended CreditFlagstar Bank ranks very high in customer satisfaction and has an easy application process, making it a particularly good lender for first-time homebuyers getting a USDA loan.
What to look out for: Flagstar Bank has a good rate tool that lets you see personalized mortgage rates, but it doesn't include USDA loan rates.
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Recommended CreditGuild Mortgage is an affordable option, especially for borrowers who have a low credit score or no credit score. If you have no score, you can use non-traditional credit, such as rent or utility payment history, to qualify. Guild is the second largest originator of USDA loans in the country, according to the USDA.
This lender's minimum credit score for USDA loans is 540, which is lower than many other lenders. Guild also offers a hybrid closing option, enabling borrowers to sign some of their paperwork ahead of time and have a quick closing appointment.
What to look out for: Guild doesn't display any rates online. It also ranked below average in J.D. Power's 2023 satisfaction study.
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Recommended CreditMovement Mortgage is another good option for borrowers with low credit scores, since you can qualify with a score as low as 580 with this lender. It's also currently the top originator of USDA loans in the country, according to the USDA. Plus, it ranked high for customer satisfaction in 2023, according to J.D. Power.
What to look out for: Movement doesn't show any rates online, making it difficult to gauge what you might pay with this lender.
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Recommended Credit Minimum Down Payment Types of Loans OfferedConforming, jumbo, FHA, VA, USDA, renovation, HELOC, reverse mortgages, offset mortgage, All In One Loan™
CMG Financial is a solid USDA lender, and has a unique tool if you're planning to make a down payment (even though you aren't required to). CMG's HomeFundIt platform makes it easy to crowdsource your down payment, connecting directly to your social media accounts to let you share your campaign.
What to look out for: CMG Financial doesn't display any interest rates online.
USDA loans are a type of government-backed mortgage. They're guaranteed by the U.S. Department of Agriculture, meaning that they're originated by private lenders that the USDA will compensate if a borrower defaults on their loan.
This makes these mortgages less risky for lenders, allowing them to offer lower mortgage rates. The two other main types of government-backed mortgages are FHA loans and VA loans.
These loans offer up to 100% financing, which means you won't need to make a down payment to get a USDA loan. However, you will need to bring some of your own cash to the table since you'll still have to pay closing costs.
You may qualify for a USDA loan if you're in a rural or suburban area that is a USDA-designated "rural area." The USDA has a tool you can use to see if an address is in an eligible area.
Additionally, your household should be at a low-to-moderate income level. The maximum income requirement depends on where you live, and you can see your county's income limit here.
As you search for USDA loan lenders, it's a good idea to familiarize yourself with each lender's individual credit requirements, since they can differ quite a bit. Some lenders allow borrowers with scores as low as 580 to get a USDA loan, while other lenders require scores in the mid-to-high 600s.
USDA loans are the least-utilized of the three main types of government-backed mortgages, and not every lender offers them. To have a smooth experience, you'll want to work with a lender and loan officer who has a lot of experience doing these types of loans.
According to the USDA, most of the lenders included on our list were top originators of USDA loans in 2023, including Fairway Independent, Movement Mortgage, and Guild.
Apply for a mortgage with at least two or three different USDA lenders to compare rates and fees so you can see which one can offer you the best overall deal.
Working with a lender that ranks high in customer satisfaction can help you have a smoother mortgage experience, which is especially important if you're buying rather than refinancing. When you're purchasing a home, you're on a deadline, so working with a lender that offers great customer service is vital.
Find the best fit for you by exploring multiple types of mortgage lenders. You can find a list of lenders in your state that offer these loans on the USDA's website.
Local lenders can be beneficial because they're familiar with your area and local real estate market. They also often can provide more personalized support compared with lenders that lend to a large number of borrowers around the country.
Large lenders and banks can offer beneficial features you might not get with a small lender, like a convenient online process or robust digital tools to manage your application.
Mortgage brokers work with many different lenders to help you compare multiple loan options at one time. This can be more convenient and help you save money.
Which USDA lender is best? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
We think Fairway Independent is one of the best USDA lenders, but the right lender for you depends on your individual needs and financial circumstances, so be sure to shop around and compare multiple lenders.
What FICO score do you need for a USDA loan? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
The FICO score you'll need for a USDA loan varies. Many USDA loan lenders require FICO scores of at least 640. Some may allow lower scores while others could require even higher scores.
What is the income limit for a USDA loan? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
The exact income limit for a USDA loan varies by county. In general, USDA loans are for people with low-to-moderate income levels.
Is it easier to get approved for FHA or USDA? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
You may find it easier to get approved for an FHA loan if you have poor credit or a high debt-to-income ratio. But if you're struggling to come up with a down payment, you may find a USDA loan easier to get.
Do all lenders offer USDA loans? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
No, not all mortgage lender offers USDA loans.
What are today's USDA loan rates? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
USDA loan rates fluctuate daily and vary by lender. If you're interested in a particular lender, get preapproved or talk to a loan officer to see how its rates are trending.
Am I eligible for a USDA loan? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
To qualify for a USDA loan, you'll need to be in an eligible rural or suburban area and meet USDA income limits.
We consulted mortgage and financial experts to inform these picks and provide their insights about mortgage lenders.
Here's what they had to say about USDA mortgages. (Some text may be lightly edited for clarity.)
How can someone decide between a conventional mortgage vs. a government-backed mortgage, like a USDA loan?
Molly Grace, Business Insider
"USDA loans tend to be less popular than other government-backed loan options, but they're a really affordable pick if you meet the requirements. If you have a lower income and live in an eligible area (which, unless you live in a bigger city, you likely do), a USDA loan can be a good choice."
What factors should someone take into consideration when choosing a mortgage lender?
Anthony Park, author:
"The canned answer is to just go with the lowest rate. However, you also want to take into account who's going to serve your loan best. Are repayments going to be easy for you? Who is most likely to be able to help you if you need to take out a HELOC or refinance later, versus somebody who's more of a one-off type?
"They may have the lowest rates to get you involved, but they might have very, very little hand holding after the fact. I wouldn't recommend paying an exorbitant amount more for potential services in the future, but just don't always necessarily go with the rock-bottom lowest rate. There's sometimes a cost with that."
Molly Grace, Business Insider:
"Remember that you're not just choosing a mortgage lender — you're also building a homebuying team. To snag the home you want in this competitive market, you need a lender that can move quickly and has good communication with you and your real estate agent.
When I was looking for a house, I was able to text my loan officer (whom my real estate agent recommended) and get quick replies when I had questions or needed an updated preapproval letter for an offer. As you compare lenders, pay attention to how responsive they are, and ask your agent if they have any experience with the lenders you're considering."
How can someone know whether they're financially ready to buy a home?
Lauryn Williams, CFP:
"You should have funds left over after everything is said and done as it pertains to purchasing the home. So if you don't have an emergency fund plus a down payment, you're probably not ready to purchase a home. Another thing I think about is credit card debt. While you can be approved for a mortgage with credit card debt and student loans and very little cash on hand, you put yourself in a very risky situation."
Julie Aragon, Aragon Lending Team:
"You should have enough money for a down payment and closing costs. You don't have to have any reserves — you can have no money in the bank. But that doesn't mean you should have no money left over after your down payment and closing costs. I like to say it'd be good to have three to six months of expenses saved after down payment and closing costs. That might be a good sign that you're ready."
To choose the top USDA loan lenders, we looked at three main factors: