Homeownership remains the cornerstone of the American dream, but it’s out of reach for some. The U.S. Department of Agriculture seeks to lower the barriers for low-income residents in rural areas around the country. USDA loans in Texas and elsewhere provide support for “safe and sanitary” housing and related infrastructure projects to help raise the living standards in eligible areas. These areas are typically outside of small cities.
Understanding what it takes to qualify for a USDA loan in Texas is key to navigating the application process. At the Tuttle Group of Texas, we’re experienced in USDA loan requirements in Texas. We are here to help you get the funding you need to own a home. Here’s what you need to know.
Who Is Eligible?
USDA loans are open only to U.S. citizens or legal permanent residents with mid-range credit scores — typically around 640 or so, according to the USDA. In addition to a qualifying credit score, applicants must also show they have the income to support repayment and a track record that generally includes 12 consecutive months of no late payments or collection activity.
These characteristics typically apply to people who would not get approved under conventional loans. The USDA doesn’t actually make these loans; rather, the agency guarantees them with private lenders.
Which Properties Qualify?
You can only use USDA loans for properties in designated rural areas. These are typically isolated areas outside of cities with populations of 35,000 or less. Determining if your property is in a rural area isn’t always obvious, and one way to check is through the online USDA Property Eligibility Map.
But because the definition of rural areas changes regularly, the map may not be the definitive source. Consulting with the Tuttle Group or your lender as part of the application process can help make the necessary determinations. Another important eligibility factor: Under the USDA Section 502 Direct Loan Program, properties may only serve as primary residences.
Income Limits
USDA loans in Texas and other parts of the country benefit those with lower incomes. Eligibility under income limits will vary depending on where you live. Typically, adjusted household income must be equal to or less than 115% of the area median income, based on the household size. The USDA also maintains an online calculator to determine whether your income level qualifies. Loan amounts may vary based on your income as well.
Choose The Tuttle Group For Help With USDA Loans
Understanding mortgage options and different types of available loans, particularly those available through the USDA, can feel intimidating. At the Tuttle Group, we’re here to help, whether you’re a first-time home buyer, looking to refinance, self-employed, military veteran, or public servant. In particular, we can help you understand if you qualify for USDA loans in Texas for buying and rehabilitating single-family homes. USDA loan programs also provide funds for business and industry loan guarantees, community facility loans, and grants and loan guarantees for waste and water disposal facilities. For assistance, call us or contact us online.
