These mortgage loans are insured by an agency of the federal government, protecting the lender in the event a borrower can’t repay the debt. This significantly reduces the risk to the lender and may make it easier for borrowers to take out a loan by offering more lenient credit guidelines, interest rates, and down payment options.

While both are government-backed mortgages, USDA loans are run by a different government agency than FHA loans and has different application, underwriting, appraisal, lending amount, and mortgage insurance requirements. To be eligible for a USDA loan, borrowers must be purchasing or refinancing property in rural areas that the USDA has defined as eligible.

No, despite what the name implies. As long as you meet the property and eligibility qualifications for a USDA loan, you can apply.

You can navigate to the USDA's eligibility website and type in the exact address of the home you want to purchase to find out if it's in an approved area.

There are no set loan limits for USDA loans, but the maximum amount is set based on your ability to qualify for a USDA loan.

Yes, private mortgage insurance is required by the USDA and pays your lender if you default on your loan.

These are fees involved during the USDA home loan process. The upfront guarantee fee is normally equal to 1% of the loan amount. It’s usually added to the initial loan amount and paid at closing. The annual fee is normally equal to 0.35% of the loan amount and some is financed into your loan.

Yes, you should work with a Midland States Bank Mortgage Expert to help determine if you are eligible. A USDA eligibility map is a tool that helps you determine if a property is eligible for USDA financing. The map is based on the U.S. Department of Agriculture's (USDA) definition of "rural," which includes areas with a population of 35,000 or less. Your Midland States Bank Mortgage Expert will help you determine if you are eligible and if this is a good loan option for you.

To use a USDA eligibility map, simply enter the address of the property you're interested in purchasing into the search bar. The map will then show you if the property is eligible for USDA financing.

If you're not sure if a property is eligible for USDA financing, our team of mortgage specialists are ready to help you. They will be able to help you determine if the property is eligible and answer any other questions you may have.

Here are some additional tips for using a USDA eligibility map:

• The map is updated regularly, so be sure to check the latest version before making a decision.
• The map is not a guarantee of eligibility. The final determination of eligibility is made by USDA upon receipt of a complete application.
• If you have any questions, be sure to contact our mortgage team.

To apply for a USDA home loan, you will need to: 

1. Contact a Midland States Bank mortgage banker or apply online.
2. Provide the mortgage banker with the required documentation.
3. Complete a loan application.
4. Provide the mortgage banker with a down payment.
5. Close on your loan.

The USDA does not have a minimum credit score requirement, but most lenders require a score of at least 640. If your credit score is below 640, you may still be eligible for a USDA loan, but your loan will need to go through manual underwriting. Contact a Midland States Bank mortgage specialist to learn more about what you qualify for.