USDA partners with local lenders to offer guaranteed loans.
Guaranteed means USDA insures a portion of the mortgage in the event you default on your loan. Therefore, these lenders tend to feel comfortable offering modest loan terms to low-income individuals with less-than-favorable credit scores.
These types of loans typically suit low- or moderate-income borrowers. To be eligible for a guaranteed USDA loan, your adjusted household income can’t exceed more than 115% of the median family income in the designated rural area you wish to live in. Household income generally includes the combined income of the loan applicant and every adult in the household, regardless if their names are on the loan application
USDA offers three primary types of loan products to eligible borrowers: guaranteed loans, direct loans, and USDA Home Improvement loans
A home loan from the USDA loan program, also known as the USDA Rural Development Guaranteed Housing Loan Program, is a mortgage loan offered to rural property owners by the United States Department of Agriculture.