2022 USDA Eligibility Map with Rural Property Requirements

USDA Eligibility Map

You can use this interactive map to help determine if a home currently meets the USDA’s property eligibility requirements. Areas in red are not currently eligible for a USDA-backed loan.

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Condition of Home

Property must be in good condition and no huge problems with the property and past a FHA appraisal that meets HUD standards. After inspection if the appraisal report comes back with repairs needed on the property, then sellers must complete repairs prior to closing. Another option is to finance the repairs into your USDA loan. Repairs cannot exceed 10% of loan amount or $10,000, whichever is less.

Some of the conditions that are taken into account for a property is if the home has direct access to a street, up to date electrical system, adequate safe drinking water and meet requirements for sewage disposal. Home must be structurally sound and a roof with at least 3 years + of remaining life. If the property has a private well for drinking water, then a water test must be completed prior to closing to show the water is safe to drink.

What’s Next?

Once you’ve used the USDA loan map to determine if a property is eligible, your next step is to confirm you meet income requirements. The amount you can earn to have access to USDA loans is limited and varies by location and household size, so use this tool for more specific guidance.

After you’ve confirmed eligibility on both points, it’s time to apply for preapproval with a USDA-approved lender. You can then include the preapproval letter with your offer, which could help you stand out from other buyers.

The Bottom Line

USDA eligibility maps can help you determine if a target property may be able to get financed with a USDA loan. They’re fast and easy to use, simplifying the research portion of the home buying process. While Rocket Mortgage does not offer USDA loans, if you’re leaning toward this type of loan, learn more about USDA loan closing costs and different options for borrowers to cover these fees.

What is Considered a “Rural” Area According to the USDA?

A home must be located in a “rural” part of the country to be eligible for USDA financing. To set these rural areas, the USDA factors in a community’s population, its proximity to a major metropolitan statistical area (MSA), and overall access to mortgage credit in the area.

Rural areas must fall into one of the three following categories:

  1. It must have no more than 10,000 residents.
  2. If the area has 10,001 to 20,000 residents, it cannot be located in an MSA. There also must be a serious lack of mortgage credit for low- and moderate-income families.
  3. If the area has 20,001 to 35,000 residents, it must have once been considered rural but lost its status in the 1990, 2000, or 2010 Census. Again, there also must be a serious lack of mortgage credit in the area.

As you can see, there’s a lot that goes into determining a city’s (and a property’s) USDA eligibility. To see eligible areas in your region, simply search a local address on the USDA property eligibility map. Any land outside the shaded areas on the map is fair game.

USDA eligibility requirements

Basic USDA loan requirements include:

  • Minimum credit score: 640 with most lenders
  • Clean credit history: No late payments or recent bankruptcy or foreclosure
  • Income requirements: household income limits vary by area; often $91,900 for a 1-4 person household
  • Employment: Borrowers need a steady income and employment history. Self-employment is eligible
  • Geographic requirements: You must own a home in an eligible rural area
  • Property requirements: Must be a single-family home you’ll use as your primary residence
  • Loan type: Only a 30-year fixed-rate mortgage is allowed

In addition, most USDA lenders want borrowers to have a 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.

What does property eligibility mean?

While all lenders review the value of a property before deciding if they will approve a mortgage, the USDA loan program is designed to provide loans for low- and moderate-income households living in rural areas. The loan program is focused on improving access to affordable homeownership in rural areas.

The USDA eligibility map offers an initial way to search locations and identify areas where USDA loans are available. Only properties within areas designated as rural qualify for the loan program. If you’re shopping for a home in an area that could be defined as rural, checking the USDA property eligibility map is a first step to see if USDA financing is available.

Property Eligibility Requirements For USDA Loans

To be eligible for the USDA loan program, a property must be:

  • Located in a rural area (generally defined as a region outside of a major city with fewer than 35,000 residents)
  • Used as a primary residence only, not for income-generating endeavors
  • Less than 2,000 square feet in size (typically)
  • Structurally sound and fully functional, including major systems like plumbing and electric
  • Without an in-ground swimming pool

Please note: This isn’t an exhaustive list of requirements. For the full scoop in your area, reach out to your nearest USDA Rural Development location.

Why does USDA have property eligibility requirements?

While property eligibility requirements for USDA loans may seem restrictive at first glance, they’re actually more accessible than you may realize. In fact, 97% of land area in the United States is eligible for USDA loans.

The USDA Single-Family Housing Guaranteed Loan Program was designed to stimulate growth in less-populated, rural, and low-income areas, hence why USDA rural home loans often offer significantly more attractive terms. Those include no-down-payment options, sometimes lower interest rates, and easier credit score requirements than conventional loans.

What qualifies as a designated rural area?

While you may think a rural area is defined by farms, fields and tiny villages, the USDA definition of a designated rural area is broader.

According to the USDA, an area can qualify as “rural” if it has:

  • A population of no more than 2,500 people
  • A population between 2,500 and 10,000 if it’s rural in character
  • A population between 10,000 and 20,000 but isn’t part of a metropolitan statistical area (MSA) and doesn’t offer mortgage programs for low- to moderate-income families

USDA property eligibility

Officially called the “rural development loan,” USDA’s mortgage program is intended to promote homeownership in underserved parts of the country.

Because of this, the United States Department of Agriculture will only guarantee loans in eligible rural areas. But don’t be deterred. USDA’s definition of “rural” is looser than you might expect at first.

You don’t have to buy a lot of land or work in agriculture to be USDA eligible. You just need to live in an area that’s not densely populated.

Officially, USDA defines a rural area as one that has a population under 35,000 or is “rural in character” (meaning there are some special circumstances). And that covers the vast majority of the U.S. landmass.

So before you write off a USDA loan, check your area’s status. You can find out if a property is eligible for a USDA loan on 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.

Property Value

Since it is 100% financing the appraised value will need to cover the asking price. For example, sellers ask for $200,000 for the property, then the appraised value needs to be $200,000 for USDA to insure the mortgage. One of the benefits of USDA is if you want to roll in your closing costs in the loan amount you can as long as the home appraises for more than the purchase price. The same applies to repairs, if you want to roll in repairs into the loan amount then the appraised value will needs to cover purchase price plus repairs.

Do You Meet the Requirements for a USDA Mortgage Loan?

To qualify for a USDA home loan, you’ll need to make sure you meet the minimum requirements that include:

  • Be a U.S. citizen or legal permanent resident.
  • Have acceptable credit history. While there is no minimum credit score requirement set by the USDA, credit guidelines vary depending on your lender.
  • Your monthly payment, including principal, interest, insurance, and taxes, should not exceed 29% of your monthly income.
  • Your total debt payments, including your proposed mortgage payment, should not exceed 41% of your monthly income.
  • Have stable and dependable income, typically for a minimum of two years. Adjusted household income needs to be equal to or less than 115% of the area median income.

You can check on the USDA website if your income allows you to qualify for a USDA loan. You’ll be asked to enter the state and county where you will be purchasing a home, some details about the people that will live in your household, and your income information.

The website then determines if your income falls within the range allowed, taking into consideration the allowances the USDA provides for certain situations, such as having children or disabled family members living with you.

How do I know if my home is USDA-eligible?

You can learn if your home is located in a USDA designated rural area by visiting the USDA website and entering your address to their property eligibility map.

What Is the Process for Getting a USDA Loan?

It’s best to begin your search for an eligible home after you’ve been pre-qualified for a loan. That way you’ll get an estimate of what mortgage amount you may qualify for, so you’ll know what price range to stick with when searching for a home.

The process for getting a USDA mortgage loan is similar to getting other types of home loans. First, you must work with a USDA-approved mortgage lender. Your lender will handle the loan application process, and the final determination of whether the home is an eligible property will be made by the USDA Rural Development department once it receives your application from your lender. Approval for your loan may take a little longer than normal since it needs to be approved by both your lender and the USDA.

With the financial benefits of USDA loans, plus the perks that living in a rural community brings, a home loan backed by the USDA is a great option to consider for financing your next home purchase.

If you’re interested in using a USDA loan to purchase your next home, talk to one of our loan officers today to get your questions answered and see if you qualify.

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