Is there a way to pay the USDA funding fee up front?

Sure... You can pay the USDA funding fee up-front if you wish... Not a problem. Sometimes we also make that part of seller paid closing costs if the numbers work out. I do a lot of USDA loans in MN, I'd say 99% of my clients just roll it into the loan amount. www.MortgagesUnlimited.biz/USDA

You can accomplish almost the same result by a principal reduction payment of the same amount, as soon as the loan closes. It will shorten your loan term, so more of your monthly payment goes toward principal, but will not reduce your monthly payment.

Since the USDA funding fee is included in your loan at very low interest over30 years, and all you want to do is reduce your loan by the same amount...why not just contribute the same amount to principal over a period of time. In fact, if you just add one extra mortgage payment a year...that can reduce a 30 year fixed loan to 23 years.You will save alot that way.

The funding fee is not required to be rolled into the loan amount and you are free to pay the funding fee as if it were a standard closing cost.