USDA
A USDA loan is a government-backed, no-money-down mortgage for buyers and homes in less-dense parts of the country. The U.S. Department of Agriculture created the USDA loan program to help first-time homebuyers or people who don’t meet conventional mortgage requirements. USDA loans are also known as the USDA Rural Development Guaranteed Housing Loan Program.
USDA loans have government-assisted mortgage rates, which means buyers get access to lower interest rates and payments than with other government-backed programs like FHA and VA. USDA loans are also for low- and moderate-income homebuyers in largely rural areas.
USDA loans have geographic restrictions, so they aren’t for people who want to buy a home in the heart of a major city. Urban properties fall outside of the qualifying geographic areas. However, many towns fall within the USDA property eligibility map, especially if you’re looking at towns of fewer than 35,000 people.
USDA funding can only be used on your primary residence, but conventional loans don’t have these same restrictions.