April 28, 2016 – The United States Department of Agriculture (USDA) just announced a revision to the upfront guarantee fee and annual fee structure for the Single Family Housing Guaranteed Loan Program effective October 1, 2016.  The upfront guarantee fee will change from 2.75% to 1.0% of the loan amount.  The annual fee will change from 0.50% to 0.35% of the average scheduled unpaid principal balance for the life of the loan.

On a $200,000 loan, this means the guarantee fee will drop from $5,500 to $2,000.  The guarantee fee can be financed (added to the base loan amount).

Please refer to the unnumbered letter (UL), “Upfront Guarantee Fee and Annual Fee for Fiscal Year 2017,” for additional details. 

 The “Guarantee Fee & Annual Fee Calculator” is available online at the USDA LINC Training and Resource Library in the “Loan Origination” and “Guarantee Annual Fee (GAF) Billing and Payment” sections of the page.