Types of home loans, and what they do with land

The one that matters most here

USDA Rural Development loans

We put this first because in Putnam County it belongs first. Much of the county sits inside a USDA-eligible area, and a zero-down loan on a property people assume needs 20% down is the single most useful thing a local buyer can know.

• No down payment for buyers who qualify.
• Two separate tests, both of which must pass. The property has to sit inside an eligible area on the USDA map, and your household income has to be under the limit for that county and household size.
• Guarantee fees apply upfront and annually, in place of conventional mortgage insurance.
• Owner-occupied primary residences only. Not investment, not second homes, not hunting camps.
• The house has to be in condition. USDA appraisals hold the property to standards, and a lot of older rural housing stock needs work before it clears.
• Land value is limited. There are rules about how much of the total value can sit in the land rather than the dwelling, and about income-producing agricultural use. On a big acreage tract this is where USDA sometimes stops being an option.

Check the exact address on the USDA property eligibility map before you get attached to anything. Boundaries are redrawn periodically, and eligibility is by address, not by county.

Land is not a house

Land loans, lot loans and construction

Buyers regularly call us about a five-acre parcel expecting to put 5% down on a thirty-year mortgage. That is not how land works, and finding it out at the closing table is a bad afternoon.

There is more on what to check before you buy acreage — wells, septic, access, flood and soils — on our land and rural systems guide.

The workhorse

FHA loans

3.5% down at the standard tier, and more tolerance for imperfect credit than conventional financing. In practice it is the most common loan on a Palatka or Interlachen house priced in the middle of the market.

• Mortgage insurance comes in two parts: an upfront premium financed into the loan, and an annual premium collected monthly which on most modern FHA loans stays for the life of the loan.
• Loan limits are set county by county by HUD and change annually. Look up the current figure at the HUD limits tool rather than trusting anything you read online.
• The appraiser holds the property to minimum standards. On the older housing stock in Putnam County that means peeling paint on pre-1978 homes, missing handrails, exposed wiring, roof age and septic condition all come into play.

The default elsewhere

Conventional loans

Written to Fannie Mae or Freddie Mac guidelines. Stronger credit generally prices better here than on FHA, and the mortgage insurance ends once you hold enough equity, which FHA insurance mostly does not.

• Down payments from 3% on some first-time buyer products; 5% is common.
• PMI applies below 20% down and is cancellable.
• The 2026 baseline conforming limit for a one-unit property is $832,750 in most of the country, per the Federal Housing Finance Agency's November 2025 announcement.
• Acreage complicates the appraisal. Appraisers need comparable sales, and on a 20-acre parcel in Florahome those are thin on the ground. Barns, workshops and pole buildings routinely appraise for far less than they cost to build.
• Investment property and second homes are conventional territory, because FHA, VA and USDA all require you to live there.

For those who served

VA loans

No down payment on most purchases and no monthly mortgage insurance at all. A funding fee applies instead — per the Department of Veterans Affairs, 2.15% of the loan amount on first use with no down payment and 3.3% on subsequent use, financed into the loan, and waived entirely for veterans receiving compensation for a service-connected disability.

The VA appraisal includes a condition review against Minimum Property Requirements, which is a separate exercise from your own home inspection. On rural property expect attention to the well, the water test, the septic system and the roof. Confirm current fee figures at va.gov.

Common out here

Manufactured and mobile homes

A large share of Putnam County housing is manufactured, and the financing rules are specific enough that using the wrong lender wastes weeks.

• Real property or personal property. A manufactured home permanently affixed to land it is titled with can be financed as real estate. One that is still titled as a vehicle generally cannot, and that is a solvable but not instant problem.
• Age matters. Many lenders will not finance homes built before 15 June 1976, and plenty draw the line later than that.
• Foundation certification. FHA, VA and USDA files usually require an engineer's certification that the foundation and tie-downs meet requirements.
• Fewer lenders, so ask early. Some of the companies on our lender directory publish manufactured-home lending on their own sites; most do not.

Assistance

Florida Hometown Heroes

Florida Housing Finance Corporation's Hometown Heroes program is a second mortgage covering down payment and closing costs for full-time employed Floridians buying a primary residence. As published by the program administrator, eHousingPlus, in August 2026: 5% of the first mortgage amount up to $35,000, minimum 640 credit score, pairable with FHA, VA, USDA-RD or conventional HFA first mortgages.

Only approved participating lenders can originate it. Funding is finite. Confirm current terms with a lender and at floridahousing.org, and see our existing Hometown Heroes guide for more.