Costs

Can You Buy a House With No Money Down? The USDA "$900 Close" Truth

Independent USDA buyer guide · Updated 2026-07-22

USDA loans really are no money down — the loan finances 100% of the purchase price, so there's no down payment to save for. But "no down payment" is not the same as "no cash." You'll still spend real money before closing on earnest, inspection, and appraisal, and possibly a well or septic test. Realistically, budget $1,500–$3,500 out of pocket before you reach the closing table, some of which comes back to you at closing.

USDA.properties is independent — not a lender and not affiliated with USDA Rural Development — so there's no incentive here to make the number look smaller than it is. Here's what zero-down actually means for your bank account.

Zero down is real

USDA and VA are the only two major programs that finance the full purchase price with no required down payment. On a $300,000 home, a USDA buyer borrows the whole $300,000 (plus the financed upfront guarantee fee). There's no 3.5% like FHA or 3–20% like conventional. That's the genuine headline, and it's why USDA is the go-to for buyers with steady income but little saved. See the down-payment rules for the full picture.

The cash you still need

Zero down removes the biggest line, not every line. Here's the cash a USDA buyer typically spends before closing:

Two things soften that number. Your earnest money is credited back to you at closing — it's not an extra cost, it's a deposit. And if you negotiate seller-paid closing costs, some of these can be reimbursed or offset at the table. The well/septic tests only apply to rural properties on private systems, which many USDA homes are. (See property requirements.)

The "$900 close" — where it comes from

You'll see claims that USDA buyers close for as little as $900. That number is real, but it's the best-case corner of the range, not the average. Here's the honest version of when it happens.

It works when all of these line up:

• The seller agrees to pay closing costs — up to USDA's 6% cap (how concessions work).
• The home is priced under its appraised value, so there's room for the concession to fit.
• It's a slow enough market that a motivated seller will accept a concession-heavy offer.
• Your earnest money gets credited back, leaving only inspection and appraisal as true out-of-pocket.

When those conditions hold, your remaining cash at the closing table can genuinely drop to a few hundred dollars. When they don't — a hot market, a full-price home, a seller who won't budge — you should budget $2,000–$3,500 instead. The $900 figure isn't a lie; it's just conditional. Plan for the realistic middle and treat the low end as a pleasant surprise.

How the 6% seller concession gets you near zero

USDA's single biggest lever is that the seller can pay up to 6% of the sale price toward your closing costs — the highest concession cap of any major loan program. On a $300,000 home that's up to $18,000, which comfortably covers a typical closing-cost bill of 3–6%. Combine that with the upfront guarantee fee being financed (not paid in cash), and the only money you truly can't offload is the pre-close cash above: earnest, inspection, appraisal, and any well/septic test.

That's the whole strategy for a near-zero-out-of-pocket USDA purchase: finance the fee, let the seller cover closing costs, and keep the pre-close cash small. The offer language that makes it happen is in how to write a USDA offer. Just remember the caveat from the closing-cost breakdown — a concession can't exceed your actual costs, and the appraisal has to support the price.

The bottom line

USDA is genuinely zero-down, but come in with your eyes open: have $2,000–$3,500 accessible for the pre-close spending, and structure the offer so the seller covers closing costs. Do both and you'll close a 100%-financed home for a fraction of what a conventional buyer needs. The full walkthrough is in how to buy a home with a USDA loan, and the fillable cash-to-close worksheet is in The USDA Home Buyer Playbook. Your exact numbers come from an approved lender's Loan Estimate.

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