Is a 0% down loan right for you?

November 10, 2016


I’ve helped many people close on a home with a USDA Rural Development Loan.  The other no money down loan program is a VA Loan reserved for Veterans  both active and non active.  But the USDA loan is a no money down loan program for homes in rural areas.  There are many loan options available to the first time home buyer and the USDA Loan is one of the strongest programs for those looking a little outside the city limits.  Just like any that sounds too good to be true there can be some caveats to this special program.  The 2 biggest things to be aware of are:


Income Eligibility


There is an income limit to be eligible for this loan type.  Each county has their own income limit for example Union County, OH has a higher income limit than Licking County, OH even though they are both in Central Ohio. Your household must make lower than the income limit to be eligible.  You can check you income eligibility here.


Associated with income eligibility is the debt to income (DTI) ratio guidelines for the program.  The DTI for a USDA loan are 29%/41%, meaning just the housing payment cannot exceed 29% of your monthly income and your total debts cannot exceed 41% of your income.  These ratios are a bit lower than most other low down payment programs but that is because the risk for a lender and USDA is much higher with a zero down program than with other low down payment programs.


Property Eligibility

The property you want to purchase with the USDA loan must in an eligible area as deemed by USDA.  This is a rural development loan and is held to helping home buyers in rural areas.  You can find out if a property is eligible by search the USDA website here.


In Central Ohio, the counties surrounding Franklin County have eligible areas for a USDA loan.  Certainly, the populated an area is, the more likely it is of not being eligible.  Use the link above to see if your dream home is an eligible area.


The USDA Rural Development loan is a great product for those first time home buyers who are looking for some place a little outside town or enjoy having the space in those rural areas.  It’s a tremendous loan product that helps many people land their dream home.




Zach is a Mortgage Advisor with State Bank in Dublin, OH. He writes and speaks regularly on the mortgage industry, personal finance, business development, and leadership. His focused approach on educating clients through the mortgage process allows him to help hundreds of new homeowners each year. 


Learn more about Zach at, find him on instagram @mortgagecoachzach, or call/text him at 740-398-4917.

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O: 614-602-3646

C: 740-398-4917







State Bank

4080 W Dublin-Granville Rd

Dublin, OH 43017

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