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Usda Vs Conventional Loan Loan guarantee definition loan guarantee – Wikipedia – Loan guarantee. Jump to navigation Jump to search. A loan guarantee, in finance, is a promise by one party (the guarantor) to assume the debt obligation of a borrower if that borrower defaults. A guarantee can be limited or unlimited, making the guarantor liable for only a portion or all of the debt. · Trust your numbers. He is probably pushing the USDA loan harder because he makes a good commission off of it, especially since the other loan you are considering isn’t through him. He wants to make money. The only way the USDA loan would be better is if you planned on staying in the house for the entire life of the loan without paying it off early.
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· "A [Single Family Housing Guaranteed Loan], restricted to borrowers with a maximum of 80 percent or less of the median income for your area, must be applied for and approved by your local USDA Rural Development office," says Steinbach.