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South San Francisco sits in San Mateo County, where most areas don't qualify for USDA financing. This is a dense, high-cost urban corridor adjacent to San Francisco proper.
USDA loans require properties in eligible rural or suburban zones. South San Francisco's core neighborhoods fail that test. You'd need to look further south or inland in the county.
As of February 2026, mortgage rates remain elevated but expected rate cuts later this year could improve affordability for qualifying borrowers. That timing matters when you're shopping for eligible areas.
USDA Loans in South San Francisco
USDA loans require the property to sit in an eligible rural area as defined by USDA maps. Your household income must stay below county limits, which in San Mateo County run substantially higher than national averages.
You need a 640 credit score minimum for most USDA lenders, though some go as low as 580. The property must be your primary residence. You can't use USDA for investment properties or second homes.
No down payment required. USDA charges an upfront guarantee fee of 1% and an annual fee of 0.35%, both lower than FHA's mortgage insurance. You must show stable income for the past two years.
Local decision guide
Use this guide to connect usda loans eligibility, lender expectations, and local market factors before comparing payment options in South San Francisco.
South San Francisco sits in San Mateo County, where most areas don't qualify for USDA financing. This is a dense, high-cost urban corridor adjacent to San Francisco proper.
USDA loans require properties in eligible rural or suburban zones. South San Francisco's core neighborhoods fail that test. You'd need to look further south or inland in the county.
As of February 2026, mortgage rates remain elevated but expected rate cuts later this year could improve affordability for qualifying borrowers. That timing matters when you're shopping for eligible areas.
Not all lenders handle USDA loans. It's a smaller program than FHA or conventional, so you need a broker who knows which of their wholesale partners actually process them efficiently.
We shop across 200+ lenders to find those with competitive USDA pricing and fast underwriting. Processing timelines run 30-45 days on average. Some lenders take longer because they're not set up for volume.
USDA requires property appraisals to meet rural housing standards. Lenders familiar with the program know how to navigate those requirements without delays. First-time USDA lenders often stumble here.
South San Francisco itself won't work for USDA. But if you're flexible on location, parts of southern San Mateo County and adjacent counties have eligible zones. We run eligibility checks before you waste time touring homes.
Most borrowers surprised to learn USDA exists assume they can't qualify because they live near a city. The eligibility maps often extend into suburban edges. Check before you assume you're out.
If your property doesn't qualify for USDA, FHA becomes your next zero-down alternative with 3.5% down. VA offers zero down if you're a veteran. Otherwise you're looking at conventional with 3-5% down minimum.
USDA beats FHA on mortgage insurance cost. FHA charges 1.75% upfront and 0.55-0.80% annually. USDA runs 1% upfront and 0.35% annually. That gap saves you $100-200 monthly on a $500K loan.
FHA works anywhere. USDA requires eligible rural areas. If location flexibility isn't an option, FHA becomes your only government-backed low-down-payment choice outside of VA for veterans.
Conventional loans with 3% down require private mortgage insurance that drops off at 20% equity. USDA's annual fee stays for the loan's life unless you refinance. Run the numbers past year five to see which costs less long-term.
San Mateo County income limits for USDA run higher than most California counties due to high area median income. A household of four can earn up to approximately $150K and still qualify, depending on exact location.
Competition in South San Francisco runs hot even without USDA eligibility. Sellers often see multiple offers. Zero-down loans sometimes face bias from sellers who prefer 20% down buyers. Your offer strength matters.
If you're set on South San Francisco proper, skip USDA and focus on FHA or conventional. If you can consider nearby communities like Pacifica, Half Moon Bay, or further south, USDA eligibility opens up.
No. South San Francisco's urban density disqualifies it from USDA eligibility. You'd need to look at less dense areas in southern San Mateo County or adjacent counties.
Most lenders require 640 minimum. Some go as low as 580 but with stricter compensating factors. Higher scores get better rates and faster approvals.
USDA requires zero down versus FHA's 3.5%. USDA mortgage insurance costs less but only works in eligible rural areas. FHA works anywhere.
Limits vary by household size and specific location. A family of four can typically earn up to $150K in high-cost San Mateo County. We verify exact limits for your situation.
Expect 30-45 days with experienced lenders. USDA adds property eligibility verification and rural housing standards review. Inexperienced lenders take longer.