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Explore the differences between a FHA, VA, and USDA home loan.

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What is a Government-Backed Mortgage?

A government-backed mortgage is a type of home loan that is insured by an agency of the federal government. These loans typically feature no or low down payment options and flexible credit guidelines because they’re seen as safest from the point of view of the lender. If you're a veteran, first-time homebuyer or low- to middle-income family, a government-backed mortgage can be a reliable, affordable option.

Popular Government-Backed Mortgages: FHA, VA & USDA Loans

Federal Housing Authority (FHA), Veterans Administration (VA) and U.S. Department of Agriculture (USDA) are government-backed mortgages featuring no or low down payment options and flexible credit guidelines.


credit score iconWhat is an FHA Home Loan?

An FHA loan is a great option if you're a first-time homebuyer or have a low credit score. FHA loans are typically easier to qualify for than conventional mortgages. They also allow you to pay as little as 3.5% for a down payment.

  • Minimum down payment: As low as 3.5%
  • Minimum credit score: 580, depending on down payment size
  • Who they’re typically best for: First-time homebuyers, low-credit score buyers



veteran loan iconWhat is a VA Home Loan?

VA loans are available to eligible active-duty military personnel and veterans. You can get up to 100% financing without a down payment or monthly mortgage insurance.

  • Minimum down payment: $0 Down, 100% Financing
  • Minimum credit score: None
  • Who they’re typically best for: Veterans, active-duty members, and military spouses



cut costs iconWhat is a USDA Home Loan?

Low- to middle-income families in some rural and suburban areas may be eligible for USDA loans. The USDA's Rural Development division partners with approved local lenders to offer some rural and suburban homebuyers up to 100% financing. These loans have flexible credit guidelines and do not require a down payment.

  • Minimum down payment: $0 Down, 100% Financing
  • Minimum credit score: 640, depending on down payment size
  • Who they’re typically best for: Rural homebuyers, low-income buyers, buyers who have no down payment savings



Features and Benefits

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No or low down payment.

VA and USDA loans offer no down payment—Up to 100% financing. FHA requires a 3.5% down payment.

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Flexible credit guidelines

Government loans offer more flexible credit guidelines than conventional loans.

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Popular for refinances, too

FHA and VA Streamline loans are available to easily refinance at a lower interest rate—even if your home value is less than the loan balance.

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Why Get an FHA, VA or USDA Loan With Midland States Bank?

When you get a government-backed loan through Midland States Bank, you'll benefit from our:

  • Online application: We make it easy for you to get a loan with our quick, secure online application process.
  • Competitive rates: We offer some of the most competitive rates on the market.
  • Full-service model: We help you with all aspects of the mortgage process.
  • Attentive service: We provide prompt, friendly assistance before, during and after your loan closes.
  • Loan expertise: We have the knowledge and experience to make the process fast and hassle-free.

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Frequently Asked Questions

Loan eligibility for government-backed mortgages includes:

  • FHA Loan: Anyone can apply for an FHA loan, but they are most popular with first-time homebuyers and people with low credit scores. 
  • VA Loans: Veterans and eligible active-duty military personnel.
  • USDA Loans: Low- to middle-income families in some rural and suburban areas.

You need mortgage insurance for FHA loans. They require an upfront mortgage insurance premium and monthly mortgage insurance. Premium and monthly mortgage insurance rates vary based on your loan term and down payment amount.

VA and USDA loans do not require mortgage insurance.

Applying for an FHA, VA or USDA loan through Midland States Bank is quick and easy. You can get help from one of our mortgage experts or start a secure online application.

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About Midland States Bank

Midland States Bank is a diversified financial services company with branch locations in Missouri and Illinois. When you work with us, you'll benefit from the strength and stability of a top financial institution. We put our heart and soul into every relationship and interaction to give you world-class service.

Get Started

If you're interested in getting a government-backed loan, we make it easy for you to start. Contact one of our local mortgage experts to review your options. You can also begin an online application now. The process takes just a few minutes to complete.

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