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Half Moon Bay sits in a coastal pocket where USDA eligibility zones meet some of California's priciest real estate. Most of the city proper doesn't qualify, but areas east toward the hills and north toward unincorporated zones often do.
With rate cuts expected later in 2026, USDA financing could become more attractive for qualifying rural properties. The zero down payment structure matters when you're competing in a market where most buyers bring 20% or more.
USDA Loans in Half Moon Bay
USDA loans require the property to sit in an eligible rural zone and borrowers to meet income caps. For San Mateo County, those income limits run lower than what most coastal earners make.
You need a 640 credit score minimum and stable employment history. The property must be your primary residence. Investment properties and second homes don't qualify under USDA rules.
Local decision guide
Use this guide to connect usda loans eligibility, lender expectations, and local market factors before comparing payment options in Half Moon Bay.
Half Moon Bay sits in a coastal pocket where USDA eligibility zones meet some of California's priciest real estate. Most of the city proper doesn't qualify, but areas east toward the hills and north toward unincorporated zones often do.
With rate cuts expected later in 2026, USDA financing could become more attractive for qualifying rural properties. The zero down payment structure matters when you're competing in a market where most buyers bring 20% or more.
USDA loans require the property to sit in an eligible rural zone and borrowers to meet income caps. For San Mateo County, those income limits run lower than what most coastal earners make.
Not all lenders handle USDA loans, and those who do often cap volume in high-cost California markets. We work with wholesale partners who actually close these deals in San Mateo County.
The approval process runs through USDA's automated system first, then to the lender. That two-step structure means timeline and documentation requirements differ from conventional loans.
Most Half Moon Bay buyers we talk to assume they don't qualify for USDA because they see coastal prices and think rural programs don't apply. Then we pull up the eligibility map and show them pockets that work.
The income cap is the real barrier here. San Mateo County limits sit well below what tech workers and coastal professionals earn. USDA works better for service industry employees, public sector workers, or single earners in eligible zones.
FHA requires 3.5% down and works anywhere in Half Moon Bay, while USDA offers zero down but only in eligible rural zones. For buyers who qualify for both, USDA wins on upfront cost.
VA loans also offer zero down with no income caps, but you need military service. Conventional loans require higher credit and down payment but skip the geographic restrictions USDA imposes.
Half Moon Bay's USDA zones cluster in unincorporated county land and eastern hillside areas. Properties near Highway 1 and downtown typically fall outside eligible boundaries.
Wells and septic systems are common in USDA-eligible zones here. Lenders require well water testing and septic inspections beyond standard appraisals. Budget extra time for those reports.
No. USDA loans require single-family homes on eligible rural land. Condos and properties in city centers don't meet program requirements.
Limits vary by household size and update annually. Most San Mateo earners exceed the caps, especially dual-income households in tech or professional fields.
Plan for 45-60 days from application to closing. The two-step approval process and rural property inspections add time compared to conventional loans.
Yes. USDA charges an upfront guarantee fee and annual fee, similar to FHA mortgage insurance. The annual fee stays for the loan's life.
Yes. You can refinance to conventional, FHA, or another USDA loan. Refinancing removes geographic and income restrictions that applied to the original purchase.