What Is a USDA Loan For a House? How to Find and Buy a USDA-Eligible Home

Redfin News

by Marissa Crum

February 19, 2026

AI-Generated Deep Dive Summary

A USDA loan is a government-backed mortgage designed to help low- to moderate-income families buy homes in eligible rural or suburban areas. These loans offer significant advantages, including zero down payment and lower interest rates, making homeownership more accessible for qualifying borrowers. The program, administered by the U.S. Department of Agriculture (USDA), aims to boost home ownership in underserved rural communities while promoting economic growth and stability. To qualify for a USDA loan, applicants must meet specific criteria. Income limits vary by county and household size, typically capped at 115% of the area’s median income. Borrowers also need a stable income source, a credit score of 640 or higher for streamlined approval (though lower scores may still be considered with additional documentation), and a reasonable debt-to-income ratio. Additionally, the property must be located in a USDA-approved area and meet safety and livability standards. Eligible properties include single-family homes, manufactured homes, condos, and townhouses, provided they are used as primary residences. The loan application process involves working with an USDA-approved lender and undergoing a two-step approval—first by the lender and then by the USDA itself. Appraisals ensure the property meets safety guidelines and is structurally sound. Borrowers can search for USDA-eligible homes using tools like the USDA’s Property Eligibility Map or collaborating with a real estate agent familiar with USDA properties. These loans are particularly beneficial for those looking to purchase

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Originally published on Redfin News on 2/19/2026