Your USDA loan, all on one page

USDA's map decides. All of Southwest Colorado falls inside its eligible areas. Near larger towns elsewhere in Colorado the boundary can fall street by street, so we check the address for you before you make an offer.

Check an address on USDA's map

USDA counts income two ways. Household income decides eligibility: everyone in the home counts, even someone not on the loan. Repayment income is what the borrowers on the loan use to qualify.

Some items lower the household figure: a deduction for each child under 18, full-time student or household member with a disability, child care for children 12 and under, and certain medical costs for elderly or disabled households. Limits vary by county and household size; 2026 limits took effect July 13, 2026.

Look up your county's limit

USDA guaranteed loans are for a primary residence. You cannot use one for a second home or a rental, and you will need to be a U.S. citizen, a U.S. non-citizen national or a qualified alien.

USDA sets no minimum credit score of its own, but most lenders require at least 550. USDA's automated system weighs the whole file, and files it does not accept can be underwritten by hand.

USDA's guideline is 29% of income for housing and 41% for all debts. Its automated system can approve higher ratios; a manual approval up to 32% and 44% needs a 680 score and a compensating factor.

If a student loan shows no payment, USDA counts 0.5% of the balance each month.

The upfront fee is 1% of the loan and can be added to it. The annual fee is 0.35% of the balance, paid monthly with the payment, for the life of the loan.

FHA's are 1.75% and 0.55% on a loan with less than 5% down, so USDA usually costs less each month for the same home. Conventional mortgage insurance can cost less with strong credit, and it can be removed later.

In Southwest Colorado, fees usually run about $3,000 to $3,500 in fees, plus prepaid taxes and insurance. Taxes and insurance vary widely from home to home, from about $600 a year in taxes and $800 in insurance to about $3,000 of each, so they move your upfront cash more than the fees do.

When the appraisal comes in above the price, closing costs can be added to the loan up to the appraised value.

Sellers can contribute up to 6% of the price toward your closing costs and prepaid items.

USDA guaranteed loans are 30-year fixed-rate loans. There is no 15-year or adjustable version.

The site must be typical for the area, and the appraisal must support the land. Outbuildings are acceptable when they are not used to earn income.

Buying land and acreage

Wells and septic must meet local health standards and be properly separated. If a test is needed, we tell you which and when, so it does not hold up closing.

Wells and septic

USDA has its own rules on age, foundation, additions and changes to the home. Tell us at the start that the home is manufactured, so we can check it against USDA’s rules before the appraisal.

Manufactured homes, explained

A USDA purchase can include repairs, with the loan based on the value once the work is done.

For owners with a USDA loan whose home is still their principal residence. Household income must still be within USDA’s limit. The new rate must be fixed and no higher than your current rate. No cash out; closing costs and the upfront fee can be added to the loan.

USDA's annual fee lasts for the life of the loan. At or below 80% of the home's value, a conventional loan has no mortgage insurance; whether it pays depends on the rate and costs, and your Mortgage Plan shows the break-even month.