The USDA loan program is a popular choice for buyers looking to purchase homes in designated rural areas. However, the USDA closing process differs from traditional mortgage closings.
In this article, we will explore the timeline of the USDA closing process and discover tips to speed up your journey to homeownership. These timeframes are sometimes also referred to as “USDA loan turn times.”
How long does a USDA loan take to close?
It generally takes between 30 to 45 days to close on a USDA loan. The USDA closing process begins with the initial contract and extends to closing day.
Closing Timeline for USDA Loans
Everyone’s closing timeline is a little different, depending on a variety of factors. But understanding the key stages can help you navigate it more efficiently.
The USDA closing process can be divided into six phases:
| Phase of USDA Closing Process | Approximate Time Frame |
|---|---|
| 1. Purchase Agreement | Varies |
| 2. Appraisal | 1 week |
| 3. Underwriting | 2-7 days |
| 4. RDO Approval | A few days to a week |
| 5. Final Approval | 3+ days |
| 6. Closing | 1 week |
While each of the above phases has its approximate time frame, remember that some may overlap. For example, some USDA lenders may complete certain aspects of the underwriting phase while awaiting the home appraisal report.
Phase 1: Preapproval
The USDA loan process begins with preapproval. During this stage, your lender reviews your income, credit, and debts to verify your ability to repay your loan. The lender will determine how much you can afford to borrow and what your potential monthly payment will look like. The lender will also confirm that the home is in a USDA-designated rural area and that your household makes less than the local USDA income limit.
Getting preapproved not only clarifies your budget—it also gives you a competitive edge. A preapproval letter signals to sellers and real estate agents that you’re a serious, qualified buyer, which can make your offer more appealing in a competitive market.
Preapproval typically takes 1 to 3 business days once you submit your documentation.
Phase 2: Home Appraisal
Every USDA loan requires a home appraisal to confirm that the property meets the USDA’s minimum property standards and that it’s worth the amount you’ve agreed to pay. This protects both you and the lender by ensuring the home is safe, sound, and structurally secure.
Once you’re under contract, your lender will order the appraisal through an approved, independent third party. While the lender coordinates the process, the borrower is responsible for paying the appraisal fee, which typically ranges from $500 to $700, depending on the home’s location and size.
The appraisal process generally takes about one week, but timelines can vary depending on your area, property location, and the local demand for appraisers. Rural or high-demand markets may experience longer wait times.
Phase 3: Underwriting
Once the USDA appraisal is complete, the loan proceeds with the underwriting process.
USDA underwriting turn times usually range from 2 to 7 days. Due to their additional requirements, including property eligibility and income limit eligibility, as well as approval by the USDA Rural Development Office, underwriting for USDA loans may take longer than for traditional mortgage loans. However, quick responses to lender requests can help keep your USDA loan underwriting turn time on track.
Phase 4: USDA Rural Development Office Approval
One unique aspect of USDA loans is the two-party approval system. Once your USDA lender approves, the loan must be sent to the state's USDA Rural Development Office (RDO) for final approval. The timeline for RDO approval (often referred to as the “RDO turn time”) depends on your specific state, current demand, and various aspects of your loan. It usually takes a couple of days, but it may take a week or more, especially during busier times, such as after holidays.
Phase 5: "Clear to Close"
The final approval, also known as a "clear to close," is issued once both the lender and the state RDO have approved your loan. The timeframe for USDA final approval can vary, but it typically only takes a few days.
Phase 6: Closing
Once you receive clearance to close, you can expect to close your USDA loan within the next few days. This phase involves coordinating with the seller, your USDA lender, real estate agents (if applicable), and other relevant parties to schedule the closing date, time, and location.
How To Speed Up Your USDA Closing Timeline
USDA loans can take a bit longer to close than conventional loans because of their extra qualification steps. While this may seem daunting, there are ways to help streamline your USDA closing. The strategies below can help reduce turn times during underwriting and approval, and keep things moving along smoothly.
1. Stay Responsive
Reply quickly to your lender’s requests for documents or appraisal updates. Prompt communication helps keep underwriting on track.
2. Get Organized Early
Have all your paperwork ready. Income documents, bank statements, and property details. Preparing for potential appraisal issues or repairs ahead of time can also save valuable days later.
3. Get Preapproved First
A preapproval shows sellers you’re serious and helps speed up final approval. Afterward, keep your finances steady and avoid big purchases, job changes, or opening new credit accounts.
4. Keep Perspective
Even with preparation, USDA loans may take longer than expected. Stay patient and focused on the goal—getting the keys to your new home.
Emily Kittle is an experienced underwriter with a strong background in risk assessment, training, and loan decision-making. She excels at solving complex mortgage challenges and guiding loans to closing using creativity and critical thinking.
