USDA loans have three main requirements: your income must fall below the area limit, your property must be in an may be able to access rural area, and you need acceptable credit

Whether you meet USDA loan requirements depends on three separate things, and you have to satisfy all three. Your household income has to be at or below 115 percent of the area median income for your county — this number changes every year and varies widely by location. Your property has to sit in a designated rural area, which the USDA defines more broadly than most people expect: some suburbs and towns may have access to, but most urban cores do not. And you need a credit score of at least 580 to be considered, though lenders often prefer 620 or higher in practice.

The income limit is the one that disqualifies most people. A family of four in rural Montana might have a limit of $90,000, while the same family in a rural area near a major city could have a limit of $130,000. You count all household income — wages, self-employment, Social Security, child support, everything — before taxes. If you are over the limit, you do not meet the requirement, and no lender can override it.

Key Takeaways

  • Your household income must be at or below 115 percent of the area median income for your specific county, and this limit changes annually.
  • The property must be located in a USDA-designated rural area, which includes some towns and suburbs but excludes most cities.
  • You need a credit score of at least 580, though most lenders prefer 620 or higher in practice.
  • You can check your area's income limit and rural may be able to access on the USDA Rural Development website before contacting a lender.

How the income limit works and where to find yours

The USDA sets income limits by county every fiscal year, and they are based on the U.S. Census Bureau's median family income data. The limit for a family of four is always 115 percent of that median. A family of one has a lower limit; a family of eight has a higher one. The USDA website publishes these limits by state and county, and you can look up your specific number before you do anything else.

Income includes wages and salary, but also self-employment income (averaged over two years), rental income, Social Security, pensions, child support, and unemployment benefits. It does not include one-time payments like insurance settlements or tax refunds. If you are self-employed, the USDA will ask for two years of tax returns to verify your average income. If your income fluctuates, they use the most recent two years and average them.

The income limit applies to the entire household, not just the person whose name is on the loan. If you are married and both of you work, both incomes count. If adult children or parents live with you and have income, that counts too. Some people think they can exclude a spouse's income by not putting them on the loan — you cannot. The USDA counts all household members who will live in the home.

Rural area may be able to access and what counts as rural

The USDA defines rural more broadly than the term suggests in everyday speech. A town of 10,000 people can be rural; a suburb of 50,000 can be rural. What matters is the USDA's official designation, not whether the place feels rural to you. The agency maintains a searchable map on its website where you can enter a specific address and see whether it qualifies. If the property is not in a designated rural area, no lender can make you a USDA loan, regardless of your income or credit.

Rural areas exclude most of the immediate suburbs of major metropolitan areas and nearly all urban cores. If you are looking at a property in or very close to a large city, it probably does not may have access to. The boundaries shift slightly from year to year as population changes, so a property that was ineligible five years ago might now may have access to, or vice versa. Always check the current map before you make an offer.

Some properties sit right on the boundary, and disputes do happen. If a lender tells you a property is ineligible, you can ask the USDA Rural Development office in your state to review the information. This takes time and does not always change the outcome, but it is an option if you believe the lender made an error.

Credit score requirements and what lenders actually look for

The USDA's official minimum credit score is 580, but most lenders require 620 or higher. A score of 580 to 619 is technically possible but rare in practice — you would need a strong compensating factor, like a large down payment or a co-signer with excellent credit. Most lenders simply will not work with scores below 620 because USDA guidelines give them discretion, and they choose to set their own floor higher.

Credit score is not the only thing lenders look at. They also examine your payment history, especially on housing and credit accounts. A single late payment from five years ago is usually not disqualifying, but recent late payments or collections accounts will be. If you have had a bankruptcy or foreclosure, you can still get a USDA loan, but you will need to wait — typically three years after a bankruptcy discharge or foreclosure completion before most lenders will consider you.

Debt-to-income ratio matters too. The USDA allows lenders to go up to 41 or 42 percent of your gross monthly income in total debt payments, including the new mortgage. If you have high car payments, student loans, or credit card debt, those reduce how much house you can afford even if your credit score is acceptable.

What happens if you do not meet one of the three requirements

If your income is above the limit, you cannot get a USDA loan. There is no exception process, no appeal, no way around it. You would need to look at conventional loans or FHA loans instead. If the property is not in a rural area, the same applies — no lender can override the USDA's rural designation.

If your credit score is below 580, you have a few options. You can work on raising your score before you apply — paying down credit card balances and making all payments on time for several months can help. You can look for a lender that specializes in lower-credit USDA loans, though these are less common and may charge higher rates. Or you can explore FHA loans, which allow scores as low as 500 in some cases.

If your debt-to-income ratio is too high, you can pay down existing debt before you apply, which lowers your monthly obligations and improves your ratio. Paying off a car loan or credit card can sometimes be enough to get you under the threshold.

How to verify your own situation before contacting a lender

Start by checking the USDA Rural Development website for your state. Look up the income limit for your county and household size — if you are over it, stop here. Next, use the USDA's property may be able to access map and enter the address of the home you are interested in. If it shows as ineligible, the property does not work for a USDA loan.

Pull your credit report from all three bureaus — Equifax, Experian, and TransUnion — at annualcreditreport.com, which is the official free source. Check for errors and dispute anything that is wrong. Note your credit score; if it is below 580, you have work to do before you apply.

Calculate your household's total monthly income and your total monthly debt payments (car loans, student loans, credit cards, child support, everything). Divide total debt by total income to get your debt-to-income ratio. If it is above 42 percent, you will need to pay down debt or increase income before a lender will approve you.

Once you have verified all three — income under the limit, property in a rural area, and acceptable credit — you can contact USDA-approved lenders with confidence. If any one of the three is not met, focus on fixing that before you apply.

Frequently Asked Questions

Can I get a USDA loan if I am self-employed?

Yes, but the USDA requires two years of tax returns to verify your average income. If your business is newer than two years old, most lenders will not work with you yet. Self-employment income is averaged over two years, so if you had a very low year recently, it pulls down your average and may affect your qualification.

What if my spouse's income pushes us over the limit?

The USDA counts all household income, including your spouse's, regardless of whether they are on the loan. If your combined income exceeds the limit, you do not meet the requirement. You cannot exclude a spouse's income by leaving them off the application.

Does a bankruptcy or foreclosure automatically disqualify me?

No, but it creates a waiting period. Most lenders require three years after a bankruptcy discharge or foreclosure completion before they will consider a USDA loan. Some may require longer. After the waiting period, you can apply if your other factors — income, credit score, debt-to-income ratio — are acceptable.

Can I use a co-signer to help me meet the requirements?

A co-signer can help with credit score or debt-to-income ratio, but not with income limits. The USDA counts all household members' income, so adding a co-signer's income to yours could push you over the limit. A co-signer works best if you have a lower credit score but acceptable income.

What if the property address is on the boundary between rural and non-rural?

Use the USDA's official map to check. If it shows as ineligible, you can request a manual review from the USDA Rural Development office in your state, but this takes time and does not always change the outcome. Always verify before you make an offer on a property near the boundary.