30-year fixed USDA rates are generally in the high-5% to low-6% range — typically below conventional and roughly comparable to VA, because USDA is government-backed. And the 0.35% annual fee is far lower than FHA's, so the all-in monthly cost is very competitive. USDA is 30-year fixed only. Rates change daily and vary by borrower — figures here are illustrative, not a quote. For live pricing, see our rates page or get a quote.
| Loan type | Illustrative USDA range* | Note |
|---|---|---|
| 30-yr fixed USDA (Guaranteed) | ~5.9%–6.3% | Below conventional; near VA |
| USDA Direct | Set by USDA (as low as 1% w/ assistance) | Very-low-income, separate program |
| 15-yr / ARM USDA | Not offered | USDA is 30-yr fixed only |
*Illustrative ranges reflective of California/national USDA pricing around July 2026 — not an offer or a rate quote. Your rate depends on your profile and the market that day.
On this page
Why USDA rates run below market
USDA sits in the same club as VA: a government-backed loan, so lenders carry less risk and can price below conventional. On a typical day in 2026, USDA 30-year rates land under the conventional average and near VA. The reason is structural, not promotional — the USDA guarantee is what lets lenders offer the lower number. It's one of the quiet reasons USDA is such an affordable path for eligible buyers.
The low annual fee compounds it
A below-market rate is only half the story. USDA's annual fee is just 0.35% — versus FHA's roughly 0.55% — so even when two loans have a similar note rate, the USDA payment often comes in lower once that fee hits the monthly line. Combine a below-market rate with the lowest ongoing fee of any government loan, and USDA's all-in monthly cost is hard to beat for those who qualify. Model it on the USDA calculator.
What sets your USDA rate
| Factor | How it moves your rate |
|---|---|
| Credit score | No USDA minimum, but higher scores earn better pricing |
| Points | Paying discount points buys the rate down |
| Loan amount | Very small loans can price differently |
| Property type | Single-family typically prices best |
| Lender | USDA rates vary by lender — shopping matters |
| Market timing | Rates move daily with the bond market |
Guaranteed vs Direct rates
Two USDA programs, two very different rate structures:
- Guaranteed (what we originate): a market rate from a private lender, USDA-backed — the below-market pricing described above, for households up to 115% of area median income.
- Direct: comes straight from the USDA at a set rate, which payment assistance can reduce to as low as 1% for very-low-income households. It's a separate program through your local Rural Development office.
Most California buyers use Guaranteed. If Direct might fit your income better, we'll point you to USDA Rural Development.
What moves rates overall (the 2026 backdrop)
The market half of your rate is set by forces bigger than any lender. In 2026 the Federal Reserve has held its benchmark steady at 3.50%–3.75%, with its next meeting late July. Mortgage rates track the 10-year Treasury and mortgage-bond market more than the Fed's headline rate, moving on inflation and jobs data. Forecasters expect rates to hover in the mid-6% range for conventional — with USDA below that — easing gradually through the year. The takeaway: don't try to time the bottom. Buy when the numbers work, lock when you're comfortable, and refinance later if rates fall.
How to get the best USDA rate
- Improve your credit — no USDA minimum, but higher scores still price better.
- Shop multiple lenders — USDA rates vary; a broker shops many with one application.
- Weigh discount points — worth it if you'll keep the loan long enough to break even.
- Check Direct eligibility — if your income is very low, the Direct program may beat any market rate.
- Time your lock, not the market — lock once you're under contract and the number works.
USDA rate FAQs
What are USDA rates right now?
30-year USDA generally runs high-5% to low-6% as of mid-2026, often below conventional and near VA. Check live rates.
Why are USDA rates lower?
Government-backing lowers lender risk, so USDA prices below conventional — plus the tiny 0.35% fee keeps the total low.
Only 30-year fixed?
Yes — USDA guaranteed loans are 30-year fixed only. No 15-year or ARM options.
Guaranteed vs Direct rates?
Guaranteed = market rate from a lender. Direct = USDA's set rate, as low as 1% with assistance for very-low income.
Should I lock?
A lock guarantees your rate ~30–60 days while you close. In a steady or rising market, locking once under contract is usually safer.
Reviewed by the licensing team at Save Financial, a California-licensed mortgage brokerage (NMLS #377740, DRE #01875766) founded in 2009 and serving all 58 counties from offices in Newport Beach and Marina del Rey.