Question 1

Which parts of Watsonville qualify for USDA loans?

Accepted Answer

Eastern and southern zones qualify most often including areas near Pajaro and Freedom. The USDA map changes occasionally so we verify every address individually before making assumptions.

Question 2

Can I buy a fixer-upper with a USDA loan?

Accepted Answer

The property must be move-in ready and meet basic safety standards. Minor cosmetic issues are fine but you can't use USDA for homes needing structural repairs or septic replacement.

Question 3

How does the USDA income limit work for self-employed buyers?

Accepted Answer

USDA uses your adjusted gross income from tax returns. Self-employed buyers average the last two years of AGI to determine eligibility under the county income cap.

Question 4

What are USDA closing costs compared to FHA?

Accepted Answer

USDA charges a 1% upfront guarantee fee versus FHA's 1.75%. Annual fees run 0.35% on USDA versus 0.55% on FHA. Both allow sellers to cover buyer costs.

Question 5

Can I use USDA to buy a manufactured home in Watsonville?

Accepted Answer

Yes if the home is permanently affixed to land you own and meets HUD standards. The property still needs to be in a USDA-eligible zone and you must meet income requirements.

USDA Loans in Watsonville: Zero Down Payment on Rural Properties