Understanding USDA Loans
In order to qualify for a USDA loan, borrowers must meet certain income requirements, which vary by location and depend on household size. For additional information about USDA loans and to check on property eligibility, please visit the USDA Eligibility Website or give us a call and we would be happy to help.
USDA Loan Eligibility Requirements
To qualify for a USDA home loan, loan applicants must meet the basic eligibility requirements set forth by the USDA, which cover credit, income, home location and property usage. Minimum qualifications include:
A credit score of at least 640
If you have less than perfect credit there may be flexibility within the credit eligibility requirements. For additional information please reach out to a HomeVantage mortgage banker.
Desired home must be in an eligible rural area
Fortunately for many homebuyers, the USDA’s definition of a rural area is fairly generous. Many suburban areas qualify for USDA mortgage eligibility. Check our the USDA eligibility map for the most updated list of qualifying areas.
Household income must be within limits set by the USDA
On top of the property edibility requirements, buyers must also meet the income guidelines set forth by the USDA. Income requirements vary by state and county.
Property must be your primary residence
USDA loans are designed to make it easier to obtain a loan when you might not otherwise quality. Therefor the house that you’re looking to purchase must be used as your primary residence.
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Loan Income Requirements
One of the unique features of the USDA mortgage program is the income requirements that potential homebuyers must meet in order to qualify. By design USDA loans are meant to assist low-to-moderate income homebuyers. To help accomplish this goal, the USDA sets income limits for homebuyers based on the properties location and household size. Income limits for most areas are:
Household of 1-4: $82,700
Household of 5-8: $109,150
It’s important to note that income requirements differ by state and county. In most areas of the country annual household income can not exceed $82,700, but in some high-cost areas of the country income limits can be as high as $209,150. If you’d like to learn more about the USDA income requirements in your area, please reach out to one of our team members.