- USDA guaranteed loan
- A home loan for eligible rural and some suburban areas, made by a private lender and guaranteed by USDA Rural Development. It allows financing of the full purchase price, and borrowers must fall within household income limits. Guaranteed loans are 30-year fixed-rate loans, and the guarantee is paid for through upfront and annual fees.
- Upfront guarantee fee
- A one-time fee of 1.00% of the loan amount (USDA Rural Development, FY2026, loans obligated on or after October 1, 2025). It is usually financed rather than paid in cash, so this calculator adds it to the base loan, which means you also pay interest on it over the term.
- Annual guarantee fee
- A yearly fee of 0.35% of the average unpaid balance (USDA Rural Development, FY2026), paid in monthly installments with the mortgage payment. It works much like mortgage insurance. This calculator approximates it as a level monthly amount based on the total loan amount, so the real fee declines slightly as the balance falls.
- 100% financing
- Borrowing the full purchase price with no down payment. USDA guaranteed loans allow this, so the calculator treats the home price as the base loan amount. Closing costs are still owed, although they can sometimes be covered by seller concessions or, within limits, financed.
- Total loan amount
- The base loan (here, the home price) plus the financed upfront guarantee fee. It is the balance the monthly principal-and-interest payment repays. Because the fee is added on top, the total loan is slightly more than the purchase price, so you start with no equity until the home appreciates or the balance is paid down.
- Principal and interest (P&I)
- The part of the monthly payment that repays the total loan amount and covers interest, calculated with the standard amortization formula. This calculator adds the monthly guarantee fee to it for the headline payment. Property taxes and homeowners insurance are not included and would raise the actual monthly housing cost.
- Eligible rural area
- A location USDA has designated as eligible for its housing programs, which can include small towns and some areas on the edge of metropolitan regions. Eligibility maps are updated periodically. You can check a specific address on the USDA eligibility website; this calculator does not verify location.
- Income limits
- The maximum household income allowed for a USDA guaranteed loan, set by county and household size and changed periodically. The limit counts income of all adult household members, not only the borrowers. This calculator does not check income eligibility; a USDA-approved lender can confirm the current limit for your area.
- Interest rate
- The annual percentage the lender charges on the outstanding balance, before fees. USDA rates are set by the lender and are typically competitive with conventional loans. The calculator divides the rate by 12 and applies it to the total loan amount each month, including the financed guarantee fee.
