Program highlights
- Minimum score of 580
- Manual UW allowed
- One-time or two-time close construction
- Down payment assistance, 100%
- Renovation
- Escrow holdback
- Temporary buydowns
What is a USDA loan?
A USDA loan is a mortgage guaranteed by the U.S. Department of Agriculture's Rural Development program, and it typically lets eligible buyers purchase a primary home with no down payment. Despite the name, you do not need to buy a farm. Many small towns and suburban areas qualify.
How it works
USDA loans have two main eligibility tests: the property and the household.
- Property eligibility: the home must sit in an area USDA has mapped as eligible. These maps change over time, and some areas close to larger cities qualify while others do not. We check the exact address for you.
- Income eligibility: total household income must be at or below the USDA limit for your county and household size. USDA counts income from everyone in the household, not just the people on the loan, so we review that carefully.
USDA loans typically include an upfront guarantee fee, which can usually be financed, and an annual fee paid monthly. These fees are often lower than FHA mortgage insurance, which is part of why USDA can be a strong value.
Our minimum score for USDA is 580, and manual underwrites are allowed when the automated system does not approve a file. USDA can also be paired with renovation financing, escrow holdbacks for small items that cannot be finished before closing, temporary buydowns, and one-time or two-time close construction.
Who it fits
USDA fits buyers who have steady income, live within the income limits, and want a home in an eligible area. It is especially useful for buyers who can afford a monthly payment but have not been able to save a large down payment. Homes must be the buyer's primary residence, and properties are typically modest in size and use. If you are over the income limit or the address does not qualify, we will show you conventional, FHA, and down payment assistance options instead.
What you need to apply
- Pay stubs and two years of W-2s or tax returns for all borrowers
- Income information for every adult in the household
- Two months of bank statements
- A valid ID
- The address you are considering, so we can confirm property eligibility
How we help in Austin
Parts of the Austin area and many surrounding communities in Bastrop, Caldwell, and outer Williamson and Hays counties have included USDA-eligible areas, but eligibility is address by address and the maps are updated. Before you fall in love with a house, we check the property and your household income so you and your Realtor know whether USDA is on the table. We typically issue a pre-approval letter within 24 hours, and we lend in 7 states.
Additional terms and conditions apply. Not all loan types are compatible with this product. Subject to underwriting conditions. Not a promise to make a loan. All borrowers must qualify.
USDA Loans: common questions
Do USDA loans really require no down payment?
Typically, yes. USDA loans allow eligible buyers to finance the full purchase price of a primary home in an eligible area. You will still have closing costs, but sellers can contribute toward them, and in some cases the loan can cover part of them if the appraisal supports it. We show you your estimated cash to close before you make an offer.
How do I know if a home is USDA eligible?
USDA publishes property eligibility maps, and eligibility is checked address by address. Some areas near cities qualify while nearby neighborhoods do not, and the maps change over time. Send us the address or MLS link and we will confirm whether it qualifies. We recommend checking before you write an offer so there are no surprises during underwriting.
What are the USDA income limits?
USDA sets income limits by county and household size, and they are updated regularly. The limit applies to total household income, which can include adults in the home who are not on the loan. Because the rules for counting income are specific, we calculate it for you rather than relying on a quick online estimate, then tell you whether USDA fits.
What credit score do I need for a USDA loan?
Our USDA minimum is a 580 credit score, and manual underwrites are allowed when the automated system does not approve the loan. A manual underwrite looks at your rent history, reserves, and overall credit pattern. Scores in the higher ranges generally make the process smoother, but a lower score does not automatically rule you out, so call us to review your situation.
Can I build a new home with a USDA loan?
Yes. We offer one-time and two-time close construction on agency loans, including USDA, for eligible properties and builders. A one-time close covers the construction and permanent loan in a single closing. A two-time close uses a separate construction loan followed by a permanent loan. Builder approval, property eligibility, and income limits all still apply.