Loan programs
USDA Guarantee Fee Calculator: Upfront and Annual Fees
USDA guaranteed loans need no down payment, but they carry two fees: an upfront guarantee fee and an annual fee paid monthly. Estimate both here.
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USDA guarantee fee
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In plain words
On a $260,000 USDA loan, an upfront fee of 1% is $2,600, so the loan becomes $262,600 if you finance it. An annual fee of 0.35% adds about $76 a month in the first year.
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Key figures
- Upfront guarantee fee$2,600
- Annual fee per month (first year)$76
- Annual fees, first 10 years$8,711
- Annual fees, full term$18,954
- Loan amount with fee financed$262,600
- Annual fee
View chart as table
| Year | Annual fee |
|---|---|
| Year 1 | $919 |
| Year 2 | $910 |
| Year 3 | $901 |
| Year 4 | $891 |
| Year 5 | $880 |
| Year 6 | $869 |
| Year 7 | $856 |
| Year 8 | $843 |
| Year 9 | $828 |
| Year 10 | $813 |
| Year 11 | $796 |
| Year 12 | $778 |
| Year 13 | $758 |
| Year 14 | $738 |
| Year 15 | $715 |
| Year 16 | $691 |
| Year 17 | $665 |
| Year 18 | $636 |
| Year 19 | $606 |
| Year 20 | $574 |
| Year 21 | $538 |
| Year 22 | $501 |
| Year 23 | $460 |
| Year 24 | $416 |
| Year 25 | $369 |
| Year 26 | $318 |
| Year 27 | $264 |
| Year 28 | $205 |
| Year 29 | $142 |
| Year 30 | $73 |
Compare scenarios
| Scenario | Upfront guarantee fee | Annual fee per month (first year) |
|---|---|---|
| Your numbers | $2,600 | $76 |
| Maximum fees allowed | $9,100 | $108 |
| Difference: Maximum fees allowed | +$6,500 | +$33 |
Premium schedule by year
| Year | Mortgage insurance | Balance |
|---|---|---|
| Year 1 · Nov 2026 | $919 | $260,132 |
| Year 2 · Nov 2027 | $910 | $257,474 |
| Year 3 · Nov 2028 | $901 | $254,613 |
| Year 4 · Nov 2029 | $891 | $251,533 |
| Year 5 · Nov 2030 | $880 | $248,217 |
| Year 6 · Nov 2031 | $869 | $244,648 |
| Year 7 · Nov 2032 | $856 | $240,805 |
| Year 8 · Nov 2033 | $843 | $236,668 |
| Year 9 · Nov 2034 | $828 | $232,214 |
| Year 10 · Nov 2035 | $813 | $227,419 |
| Year 11 · Nov 2036 | $796 | $222,257 |
| Year 12 · Nov 2037 | $778 | $216,699 |
| Year 13 · Nov 2038 | $758 | $210,717 |
| Year 14 · Nov 2039 | $738 | $204,276 |
| Year 15 · Nov 2040 | $715 | $197,342 |
| Year 16 · Nov 2041 | $691 | $189,877 |
| Year 17 · Nov 2042 | $665 | $181,841 |
| Year 18 · Nov 2043 | $636 | $173,189 |
| Year 19 · Nov 2044 | $606 | $163,876 |
| Year 20 · Nov 2045 | $574 | $153,849 |
| Year 21 · Nov 2046 | $538 | $143,054 |
| Year 22 · Nov 2047 | $501 | $131,433 |
| Year 23 · Nov 2048 | $460 | $118,922 |
| Year 24 · Nov 2049 | $416 | $105,453 |
| Year 25 · Nov 2050 | $369 | $90,953 |
| Year 26 · Nov 2051 | $318 | $75,343 |
| Year 27 · Nov 2052 | $264 | $58,537 |
| Year 28 · Nov 2053 | $205 | $40,445 |
| Year 29 · Nov 2054 | $142 | $20,968 |
| Year 30 · Nov 2055 | $73 | $0 |
| Totals | $18,954 |
How to use this calculator
- Enter the loan amount before any fee. With no down payment, this is usually the purchase price.
- Check the upfront fee rate with your lender and enter it (the box starts at 1%).
- Enter the annual fee rate (the box starts at 0.35%).
- Read the upfront fee, the financed loan amount and the monthly cost added to your payment.
USDA guaranteed loans, under the Section 502 program, let moderate-income buyers purchase in eligible rural and suburban areas with no down payment. The government backs part of the loan, and borrowers pay for that backing through two guarantee fees. This calculator shows what they add up to.
How this USDA fee calculator works
Upfront fee = loan amount × upfront fee rate
Financed loan = loan amount + upfront fee
Monthly annual fee (first year) = loan amount × annual fee rate ÷ 12
Federal regulations (7 CFR 3555.107) cap the upfront fee at 3.5% and the annual fee at 0.5%. USDA sets the rates actually charged and can change them. The calculator starts at 1% upfront and 0.35% a year, figures USDA has published for its guaranteed program, but you should confirm the current rates with your lender because we could not confirm a fiscal-year 2026 notice directly.
Worked examples
Example 1: a $260,000 home with no money down
- Upfront fee: $260,000 × 1% = $2,600.
- Financed loan: $260,000 + $2,600 = $262,600.
- Annual fee, first year: $260,000 × 0.35% = $910, or about $76 a month.
Example 2: a $200,000 loan
The upfront fee is $2,000, the financed loan is $202,000 and the annual fee is $700 for the first year, about $58 a month.
If USDA were to charge the maximum the rules allow, 3.5% upfront and 0.5% a year, the first example would cost $9,100 upfront and about $108 a month, so it matters which rate applies when your loan is approved.
What your result means
The monthly fee is added to your house payment along with principal, interest, taxes and insurance. To see your full payment, use the mortgage payment calculator with 0% down, the financed loan amount and the PMI rate set to the annual fee rate. Because the fees are lower than FHA’s, a USDA loan is often the cheapest low-down-payment option for buyers who qualify.
Program rules that change the answer
| Rule | What it means for you |
|---|---|
| Eligible area | The home must be in an area USDA maps as eligible; check the address on USDA’s map |
| Income limit | Household income must be at or below USDA’s limit for the area (moderate income) |
| Primary residence | You must live in the home |
| Citizenship or status | US citizens, non-citizen nationals and qualified aliens can apply |
| Loan type | 30-year fixed rate guaranteed loan |
Read the USDA loan guide for eligibility details, and compare with FHA mortgage insurance if you are not sure which program fits.
USDA fees compared with FHA and conventional insurance
USDA, FHA and conventional loans all protect the lender when the down payment is small, but they charge for it in different ways. On the $260,000 example, this is how the first-year costs compare, using the USDA default rates above, FHA’s published premiums for a loan with less than 5% down, and an assumed conventional PMI rate.
| Loan, about $260,000 | Upfront | First-year monthly | Ends? |
|---|---|---|---|
| USDA (1% / 0.35%) | $2,600 | About $76 | No, life of loan |
| FHA, 3.5% down (1.75% / 0.55%) | About $4,400 | About $115 | Life of loan with under 10% down |
| Conventional, 3% down (assumed 0.6% PMI) | $0 | About $126 | Yes, at 78% to 80% of the original value |
USDA usually wins on fees, but it has the most eligibility rules. Conventional PMI depends heavily on your credit score, and it can be removed later, which can make it cheaper over many years. Our FHA vs conventional calculator and the mortgage insurance guide explain those trade-offs.
Steps from estimate to closing
- Check the address on USDA’s eligibility map before you make an offer.
- Check household income against the limit for your county; every adult’s income counts.
- Ask a USDA-approved lender which fee rates apply now and whether you can finance the upfront fee.
- Compare Loan Estimates from at least two lenders; fees are set by USDA, but rates and lender charges vary.
- Budget for closing costs with the closing cost calculator, even if some are financed.
Assumptions
- Fees are calculated on the loan amount before the upfront fee is added.
- The monthly figure is the first year’s annual fee; it declines as the balance falls.
- Default rates are common published figures, not a quote.
Common mistakes
- Assuming zero down means zero cost. The upfront fee, closing costs and prepaid items still apply, though many can be financed or paid by the seller.
- Skipping the eligibility map. A home a few miles away may be outside the eligible area.
- Counting only your own income. USDA counts the income of everyone in the household for the income limit.
Limits of this estimate
USDA and your lender determine the fees on your loan. Get a Loan Estimate and ask which fee rates apply on the date your loan is approved. A HUD-approved housing counselor can also help you compare USDA with other options.
For context, the national average 30-year fixed rate was 7.40% as of October 15, 2026 (Freddie Mac). FHA, VA and USDA rates are set by each lender and often differ.Source: Freddie Mac Primary Mortgage Market Survey, via FRED
Frequently asked questions
What are the USDA guarantee fees?
USDA charges an upfront guarantee fee on the loan amount and an annual fee that is divided into monthly payments. Federal rules cap them at 3.5% upfront and 0.5% a year; USDA announces the rates actually charged, which lenders apply to your loan.
Can I finance the USDA upfront fee?
Yes. The upfront guarantee fee can be added to the loan amount, which is why many USDA loans close with very little cash from the buyer.
How long do I pay the USDA annual fee?
The annual fee is charged for the life of the loan. It is recalculated on the remaining balance, so it falls slowly as you pay the loan down.
Is the USDA annual fee cheaper than FHA MIP?
Usually yes. A commonly quoted USDA annual fee of 0.35% is lower than FHA's typical 0.50% to 0.55%, and the upfront fee is lower too. But USDA loans are only available in eligible areas and below income limits.
Can the seller pay the USDA guarantee fee?
Sellers can contribute toward closing costs within program limits, which can cover the upfront fee if it is not financed. Ask your lender how concessions apply to your loan.
Do USDA direct loans have the same fees?
No. This calculator is for guaranteed loans made by private lenders. Direct loans from USDA for low- and very-low-income buyers follow different rules.
Sources
Read the guides
Related calculators
- FHA MIP Work out the 1.75% upfront premium, the annual premium rate HUD assigns to your loan, the monthly cost and whether you pay it for 11 years or the life of the loan.
- VA funding fee The VA funding fee is a one-time charge on most VA loans. Enter your loan details to see the percentage that applies, the dollar amount and your loan total if you finance it.
- FHA vs conventional Put the same home through both loan types and see which one costs less each month and over the years you plan to stay, with FHA mortgage insurance and conventional PMI both counted.
- Jumbo loan check Enter your loan amount and your county's conforming limit to see whether Fannie Mae and Freddie Mac can buy the loan, or whether you are in jumbo territory.