USDA Loans are primarily used to help low-income individuals or households purchase homes in rural areas. Funds can be used to build, repair, renovate or relocate a home, or to purchase a home.
- Applicants must have low to very low incomes. Very low income is defined as below 50% of the area median income; low income is between 50% and 80% of the area median income; moderate is 80% to 100% of the area median income.
- Families must be without adequate housing, but be able to afford the mortgage payments, including taxes and insurance, which are usually 24% of an applicant’s income. Applicants must be unable to obtain credit elsewhere, yet have reasonable credit histories.