Eligibility for a USDA loan is based on a combination of household size and geography, in addition to the typical mortgage approval standards such as income and credit score verification.
refinance via USDA, this program tends to be accessible and affordable.
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The USDA loan program is one of the best mortgage loans available for qualifying borrowers.
Basic USDA loan requirements include:
debt-to-income ratio (DTI) below 41%. That means your monthly debt payments (including things like credit cards, auto loans, and your future mortgage payment) shouldn’t take up more than 41% of your gross monthly income.
These rules are not set in stone, though.
USDA is flexible about its loan requirements. And lenders can sometimes approve applications that are weaker in one area (like credit score or DTI) but stronger in another (like income or down payment).
USDA’s goal is to help moderate to low-income buyers become homeowners. So if you meet the basic criteria — or you’re close — check your eligibility with a lender.
USDA loan income limits are set at 115% of your area median income (AMI). That means your household income can’t be more than 15% above the median income where you live.
| Area | 2022 Income Limit for 1-4 Person Household | 2022 Income Limit for 5-8 Person Household |
| Adams County, Nebraska | $91,900 | $121,300 |
| Duluth, Minnesota | $96,300 | $127,100 |
| Olympia-Tumwater, Washington | $103,700 | $136,900 |
| Napa, California | $135,250 | $178,550 |
Officially called the “rural development loan,” USDA’s mortgage program is intended to promote homeownership in underserved parts of the country.
USDA’s website. Most areas outside of major cities qualify.
To use the site, you’ll need to accept its eligibility disclaimer, select the Single Family Housing Guaranteed option, and then input the property’s address to determine its USDA eligibility.
The USDA single-family housing guaranteed program is partially funded by borrowers who use USDA loans.
USDA-guaranteed loans can be used for home buying and to refinance real estate you already own (as long as it’s in an eligible rural area).
For those who have a low to moderate income, this is often one of the best loan options available.
USDA loans are great for first-time home buyers in particular, as you don’t need any money saved up for the down payment. But remember — you’ll still have to pay for closing costs.
It could be easier than you think to qualify for a home loan via the USDA program. Check your eligibility with a USDA-approved lender today.
Authored By: Maggie Overholt The Mortgage Reports contributorMaggie Overholt is a former Editor at The Mortgage Reports, where she helps make complex topics more approachable. She has also written for publications specializing in insurance and personal finance.
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