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USDA Guarantee Fee Calculator

USDA Rural Development loans charge a 1% upfront guarantee fee (financed) plus 0.35% annual fee on outstanding balance. This calculator sizes both and compares to FHA/conventional.

$

Total guarantee fees paid

$10,640

Upfront 1% fee

$2,800

Monthly 0.35% portion

$82

Total annual fees over hold

$7,840

How the math works

$280K USDA: $2,800 upfront + $82/mo annual fee. Over 8 years: $7,840 annual fee + $2,800 upfront = $10,640 total.

Cheaper than FHA for most rural qualifying borrowers. Compare both loan types before picking — USDA has strict location + income caps that disqualify many.

How to Use

  1. Enter loan amount and holding period.
  2. See upfront fee, monthly fee, and total cost over hold.

Frequently Asked Questions

Do USDA fees ever drop off?

No — annual 0.35% is for life of loan. Cheapest way out: refi to conventional when 20% equity built.

Is USDA actually cheaper than FHA?

Usually yes, significantly. USDA: 1% upfront + 0.35% annual. FHA: 1.75% upfront + 0.55% annual. On $300K, USDA saves $2,250 upfront and ~$60/mo vs FHA.

Who qualifies?

Income at or below 115% of area median. Home in USDA-eligible rural area (many suburbs qualify — check USDA map). No down payment required. Primary residence only.

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