USDA Home Loans in Texas
USDA Guaranteed home loans can provide 100% financing for eligible buyers purchasing an eligible primary residence in a qualifying rural area. The two big tests are the property address and the household's income—not whether the home feels “rural.”
How does a USDA home loan work?
An approved private lender makes the mortgage and USDA Rural Development guarantees it. Eligible buyers can finance up to 100% of an eligible primary residence, while the household must satisfy current income limits and the address must be inside an eligible rural area. USDA's current Guaranteed Loan program uses a 30-year fixed-rate term.
USDA eligibility starts with address + household income
Property eligibility
USDA uses an address-based map. Some areas near growing Texas metros can qualify while others do not. Check the exact property—not the city name.
Check USDA's mapHousehold income
USDA says Guaranteed Loan household income generally cannot exceed 115% of the applicable median household income. Limits vary by location and household size.
Check USDA income eligibilityHousehold income is not the same as qualifying income
USDA can consider income in two different ways. Household/program income helps determine whether the household is under the program's income limit. Repayment income is the stable, eligible income the lender uses to determine whether the mortgage payment can be repaid.
That means income from an adult household member who is not a borrower can potentially affect USDA eligibility even if that person's income is not being used to qualify the mortgage.
Do the household-income check early.
A borrower can qualify for the payment and still be over the USDA household-income limit. That is why USDA screening should happen before a buyer relies on the 0%-down structure.
Why eligible Texas buyers consider USDA
100% financing
USDA Guaranteed loans can finance an eligible purchase without a required down payment.
30-year fixed
USDA's current Guaranteed Loan program uses a 30-year fixed-rate mortgage.
Flexible rural footprint
“Rural” eligibility is determined by USDA's map and can include areas that buyers do not necessarily think of as remote.
Private-lender competition
USDA guarantees the mortgage; approved lenders set rates and costs, so lender pricing can vary.
What credit score do you need for USDA?
USDA's public Guaranteed Loan page does not publish one universal minimum credit score. The lender must still determine that the borrower has the willingness and ability to handle debt, and lender/underwriting requirements apply.
Practical takeaway: do not assume “USDA requires exactly X score” from an old blog post. Credit profile, automated underwriting, manual underwriting rules and lender overlays can all affect the file.
What kinds of homes can USDA finance?
Residential primary home
The borrower must personally occupy the home as a primary residence.
Several property forms
USDA's current materials list detached/attached homes, condominiums, PUDs and eligible modular/manufactured housing.
Acreage can work
USDA's public Guaranteed Loan guidance does not set one universal acreage maximum. The property still must be primarily residential and otherwise acceptable.
Not an operating farm loan: the Guaranteed home-loan program is not for an income-producing property. Rural land by itself does not make a commercial/agricultural property eligible.
0% down does not mean every closing is $0
There can still be closing costs, prepaid taxes and insurance, escrow funding, inspections and other expenses. USDA also uses an upfront guarantee fee and annual fee under current program rules.
Depending on the transaction and program rules, seller credits, lender credits, gifts and other eligible sources may help with closing costs.
We compare USDA with FHA and conventional
If the address and income qualify, USDA can be excellent. But a buyer with strong conventional pricing or a property outside the eligibility map may be better served by another program.
USDA vs. FHA vs. conventional vs. VA
| Program | Down payment | Big eligibility gate |
|---|---|---|
| USDA Guaranteed | 0% | Eligible rural address + household income limit. |
| FHA | As low as 3.5% | FHA borrower/property underwriting; no USDA geography test. |
| Conventional | As low as 3% for eligible programs | Fannie/Freddie underwriting, PMI and applicable program requirements. |
| VA | Often 0% for eligible transactions | VA service eligibility/entitlement and VA underwriting/property rules. |
How to use USDA without wasting time
Check household income
Screen the applicable household members against current limits.
Prequalify the borrower
Review credit, repayment income, debts and available funds.
Check the address
Once a home is identified, verify the exact address on USDA's current map.
Underwrite & close
Complete lender and USDA Guaranteed Loan underwriting and property review.
Use the current USDA map and income limits—not an old ZIP-code list
Bryce Kennemer, NMLS #1808043 · Guarantee Mortgage, LLC · Company NMLS #279696
USDA boundaries and income limits are data-driven. We screen the actual household and property rather than assuming a Texas town is eligible based on an old article.
USDA home loan FAQs
What is a USDA home loan?
A USDA Single Family Housing Guaranteed Loan is a mortgage made through an approved private lender and guaranteed by USDA Rural Development. It can provide 100% financing for eligible households purchasing an eligible primary residence in a USDA-eligible rural area.
Do USDA loans require a down payment?
The USDA Guaranteed Loan Program permits 100% financing for eligible transactions, so a down payment is not required by the program. Closing costs, prepaid items and guarantee-fee treatment still affect final cash to close.
What income limit applies to a USDA loan?
USDA states that household income for the Guaranteed Loan Program generally cannot exceed 115% of the applicable median household income. The actual limit varies by location and household size and should be checked using USDA's current eligibility tools.
Does everyone in the household's income count for USDA?
USDA distinguishes program/household income used to determine income eligibility from repayment income used to qualify the mortgage. Income from household members who are not loan borrowers can matter to eligibility even when it is not used to qualify the mortgage payment.
How do I know if a Texas property is USDA eligible?
USDA provides an official property-eligibility map. Eligibility is address-specific and boundaries can change, so the current map should be checked rather than assuming an entire city or county is eligible or ineligible.
Does USDA have a minimum credit score?
USDA's public Guaranteed Loan program page does not state one universal program minimum credit score. Approved lenders and automated/manual underwriting rules still evaluate credit history and can have operational credit requirements.
Is USDA only for first-time homebuyers?
No. USDA Guaranteed loans are not limited to first-time buyers, but the borrower must meet household-income, occupancy, credit and other program requirements.
Can I use USDA to buy a home on acreage?
USDA's current public program guidance does not state a universal acreage limit for the Guaranteed Loan Program. The property must still be residential, eligible, typical for the area, and not primarily income-producing.
Can USDA finance a manufactured or modular home?
USDA's current Guaranteed Loan program materials list eligible property types that can include modular and manufactured housing when the property and transaction meet current program requirements.
Can I buy a farm with a USDA home loan?
USDA Guaranteed home loans are for a primary residence and not for an income-producing property. Rural location alone does not make an operating farm or commercial agricultural property eligible.
What loan term does USDA Guaranteed use?
USDA's current public Guaranteed Loan Program states that the loan term is a 30-year fixed-rate mortgage. The program does not currently list 15-, 20-, 25-year or adjustable-rate Guaranteed purchase terms.
Who sets the USDA mortgage interest rate?
USDA does not set one consumer rate for guaranteed loans. The approved private lender determines the interest rate and closing costs, so terms can vary by lender.
Does USDA have mortgage insurance?
USDA Guaranteed loans use an upfront guarantee fee and an annual fee rather than conventional private mortgage insurance. Current fee levels should be confirmed for the transaction because program fee schedules can change.
Is USDA better than FHA?
It can be for an eligible borrower/property because USDA can provide 100% financing, but household-income and property-location rules are stricter. FHA has broader property-location eligibility and different mortgage-insurance and qualification rules. Compare both on the actual address and borrower profile.
Sources and program references
Mortgage guidelines change. These primary sources are included so borrowers can verify the underlying program rules.
See whether USDA fits your household and property search
We can check household income, mortgage qualification and target areas before you build your home search around USDA financing.
Guarantee Mortgage, LLC · Company NMLS #279696. Bryce Kennemer · NMLS #1808043. Equal Housing Opportunity. USDA program eligibility, income limits, property boundaries, fees and underwriting requirements can change. Information is educational and not a commitment to lend. Guarantee Mortgage is not affiliated with or acting on behalf of USDA or any government agency.
