Below we have listed the current USDA mortgage loan fees for 2015. All government home loans ( USDA, FHA, VA) have related loans fees. Although this upfront fee can be called many different names between loan programs, they are essentially the same thing. FHA refers to their fee as “up front mortgage insurance” ( UFMIP) VA refers to this as a “funding fee” USDA Rural Housing calls this fee a “Guarantee Fee”
4/28/2016 – Please disregard the information below and see important update about USDA Guarantee Fee reduction here. Starting October 2016 – all USDA Rural Housing fees will be reduced.
All USDA loans ( purchase and refinance) require a one-time Guarantee Fee that is added to the borrowers loan. The current amount of the USDA guarantee fee is 2%. Example – if a borrower was purchasing a home 100% financing for $150,000, the adjusted loan amount with the 2% USDA guarantee fee would be $153,000. $3,000 added to the base loan amount.
In addition to this one time Guarantee Fee, USDA loans also require a annual fee that is added to the monthly mortgage payment. Basically the “annual fee” is monthly mortgage insurance – or more commonly known as “PMI” Again, like the above it can have many different names. The current amount of this fee is .5%.
Example – if a borrower was purchasing a home 100% financing for $150,000. $150,000 x .005 = $750. $750 is the yearly amount, now divide this by 12 month = $62.50 is the amount of monthly mortgage insurance that will be added to the borrowers USDA loan.
Keep in mind these fee aren’t the only loan related fees or closing costs with USDA loans. USDA mortgages (like other loans) will also have all the customary closing costs that come with a Florida mortgage. Appraisal, Survey, Title, Government taxes, lender fees, in addition to all the home insurance and tax reserves for your escrow account. All in all, it’s a good idea to figure about 4% of the purchase price is needed for all closing costs and pre paid reserves. This figure can sway a few percent either way depending on the loan amount. Higher USDA loan amounts will be much less of a percentage because many of the USDA closing costs ( appraisal, survey,. etc) are fixed costs and don’t change based on the homebuyers purchase price / loan amount.
Update – 7/1/2015 – USDA has already announced the new 2015-2016 Fee’s.
Questions about USDA fees or closing costs? just submit the short Info Request Form on the right side of this page for fast service 7 days a week or call 800-743-7556. Mobile users can find the Info Request Form here.
USDA Guarantee, Annual Fee for 2015