Loans Buy a home USDA purchase
USDA loans: no down payment for rural and small-town homes
Backed by the U.S. Department of Agriculture, these loans help moderate-income buyers purchase in eligible rural areas with nothing down. Much of Southwest Colorado may qualify.
New to this loan? Start here: USDA loans: nothing down outside town A 2-minute lesson
Who it fits
It fits buyers with steady income within the area limit who want a home outside the larger city centers and do not have a down payment saved. USDA's yearly fee is lower than FHA's mortgage insurance, so it often has the lower monthly cost.
In Southwest Colorado, many homes have a few acres, a private well and septic, which is what USDA was designed for. We check the address on USDA’s map and the household income against the county limit before you write an offer. If the home needs work, see USDA rehab.
USDA, FHA or HomeReady?
| Feature | USDA | FHA | HomeReady |
|---|---|---|---|
| Minimum down | None | 3.5% | 3% |
| Upfront fee | 1% | 1.75% | None |
| Yearly fee | 0.35% | About 0.55% | Varies with credit, cancellable |
| Location | Eligible rural areas | Anywhere | Anywhere |
| Income limit | 115% of area median | None | 80% of area median |
For anyone who has served, a VA loan also needs no down payment, with no income limit, no rural map and no yearly fee.
Calculators and guides
Common questions
Is my address eligible for USDA?
Only USDA's map decides. Enter the address, or send it to us and we will check it. Eligibility can change street by street near town lines.
How much land can the property have?
USDA has no fixed acreage limit. The site must be typical for the area, and the land cannot be used mainly to produce income, like a working farm.
Can the home have a well or septic system?
Yes. Private wells need a recent water test, and wells and septic must be properly separated.
Can the seller help with closing costs?
Yes, up to 6% of the price.
What counts toward the income limit?
Income from everyone in the household who is 18 or older, even people not on the loan. Certain deductions, like childcare, can lower the figure.