USDA Mortgage Rates Today 2026
Current USDA loan rates for rural and suburban homebuyers. Check income limits, property eligibility, and learn how USDA loans compare to other programs.
Last updated: September 16, 2026
Current USDA Mortgage Rates
Average USDA Guaranteed Loan rates from approved lenders
| Loan Type | Interest Rate | APR | Change |
|---|---|---|---|
| 30-Year USDA Fixed | 6.4% | 6.55% | -0.03 |
| 15-Year USDA Fixed | 6.05% | 6.25% | +0.01 |
What Is a USDA Loan?
A USDA loan is a mortgage program backed by the U.S. Department of Agriculture designed to promote homeownership in rural and suburban areas. USDA loans offer 100% financing (0% down payment) and competitive interest rates, making them an excellent option for eligible buyers who live outside major metropolitan areas. Unlike what many people assume, USDA loans are not just for farmers — many suburban neighborhoods qualify.
Key USDA Loan Benefits
- 0% Down Payment — Finance 100% of the purchase price
- Below-market interest rates — typically comparable to or lower than conventional
- No maximum purchase price — only income limits apply
- Flexible credit guidelines — some lenders accept 640+ scores
- Can be used for new construction, existing homes, and foreclosure purchases
USDA Income Limits 2026
USDA loans have income limits to ensure the program serves low- to moderate-income households. Your total household income cannot exceed 115% of the area median income (AMI). The limits vary by household size and location. Here are the standard 2026 income limits:
| Household Size | Standard Areas | High-Cost Areas |
|---|---|---|
| 1-4 members | $103,500 | $$138,100 |
| 5-8 members | $136,600 | $$182,000 |
* The standard income limit is $103,500 for households of 1-4 members. For each additional household member beyond 4, add 8% of the 4-member limit (approximately $8,280 per person). Some counties with higher costs of living have limits up to $138,100 for 1-4 member households.
Important Income Rules
- • Household income includes income of all adult household members, not just borrowers
- • Deductions allowed: childcare expenses, disability expenses, medical expenses for elderly/disabled, full-time student deductions
- • Adjusted income is used for eligibility — your gross income may be higher than the limits after deductions
- • Use the USDA Income Eligibility Calculator for your exact area
USDA Property Eligibility
USDA loans can only be used to purchase homes in designated rural areas. However, "rural" is defined broadly — areas with populations up to 35,000 may qualify, and many suburban neighborhoods near major cities are eligible. The USDA defines eligible areas as:
Eligible Areas
- Open country that is not part of an urban area
- Towns and communities with fewer than 2,500 people
- Areas with 2,500-10,000 people if rural in character
- Areas with 10,000-35,000 people if they have a serious lack of mortgage credit
- Some suburban areas of larger cities (grandfathered zones)
Eligible Properties
- Single-family homes (primary residence)
- New construction and modular homes
- PUD (Planned Unit Development) homes
- Condominiums on the VA-approved list
- No investment properties or second homes
Eligible Areas by State
Texas
HighTop eligible cities:
Amarillo, Lubbock, Midland, Wichita Falls, Abilene
Ohio
HighTop eligible cities:
Toledo, Youngstown, Springfield, Mansfield
Georgia
HighTop eligible cities:
Athens, Macon, Valdosta, Rome, Gainesville
North Carolina
ModerateTop eligible cities:
Asheville (parts), Greenville, Fayetteville, Wilmington (parts)
Indiana
HighTop eligible cities:
Fort Wayne, Lafayette, Muncie, Terre Haute
Iowa
ModerateTop eligible cities:
Des Moines (parts), Cedar Rapids (parts), Davenport, Iowa City (parts)
Check your specific address using the USDA Property Eligibility Map. Many areas that seem suburban actually qualify!
USDA vs FHA vs Conventional
How does the USDA loan stack up against other popular mortgage programs? Here is a detailed comparison:
| Feature | USDA Loan | FHA Loan | Conventional |
|---|---|---|---|
| Down Payment | 0% | 3.5% | 3-5% |
| Guarantee Fee | 1% upfront + 0.35% annual | 1.75% UFMIP + 0.55% annual | PMI if under 20% |
| Interest Rate | Lowest | Low | Moderate |
| Min. Credit Score | 640 | 580 | 620 |
| Income Limits | Yes (115% AMI) | None | None |
| Location Restriction | Rural/suburban only | Any | Any |
| Max Purchase Price | No limit | Loan limit caps | Loan limit caps |
Choose USDA If...
- You are buying in a rural or suburban area
- Your household income is within USDA limits
- You want 0% down with no PMI
- You have a credit score of 640+
Choose FHA or Conventional If...
- You are buying in a major city or urban area
- Your income exceeds USDA limits
- You need a higher loan amount
- You want to buy an investment property
USDA Loan FAQ
What are the current USDA mortgage rates?
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As of August 2026, the average 30-year USDA fixed rate is approximately 6.4%. USDA rates are competitive with FHA and often lower than conventional rates due to the government guarantee.
What is the USDA guarantee fee?
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The USDA guarantee fee consists of a 1% upfront fee (can be rolled into the loan) and an annual fee of 0.35% of the remaining balance. The annual fee is divided into monthly payments. This is lower than FHA MIP.
What areas qualify for USDA loans?
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USDA loans are available in rural areas and many suburban communities. Generally, areas with populations under 35,000 may qualify. Many neighborhoods on the outskirts of major cities are eligible. Use the USDA eligibility map to check your address.
What are the income limits for USDA loans?
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For most areas, the income limit is $103,500 for households of 1-4 members and $136,600 for 5-8 member households. High-cost areas have limits up to $138,100 for 1-4 members. Your adjusted household income must not exceed 115% of the area median income.
Can I use a USDA loan for a new construction home?
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Yes, USDA loans can be used for new construction. The home must meet USDA property requirements and local building codes. You can also use a USDA loan to purchase a newly built home from a developer.
How long does it take to close a USDA loan?
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USDA loans typically take 30-45 days to close, similar to other loan types. The USDA has an additional review step after underwriting, which can add a few extra days compared to conventional loans.
Check Your USDA Eligibility
Use our free mortgage calculator to see your USDA monthly payment with 0% down.