If you're looking to buy a home in rural Texas, a USDA loan could be the perfect financing option for you. Backed by the U.S. Department of Agriculture (USDA), these loans offer zero down payment, low interest rates, and flexible credit requirements. However, one crucial factor to qualify for a USDA loan is your household income. USDA loans have income limits, and understanding them is essential before applying.
In this guide, we'll break down USDA loan income limits in Texas, how they work, and what you need to qualify.
What Are USDA Loan Income Limits?
The USDA sets income limits to ensure these loans are available to moderate- and low-income families. The limits vary based on household size, location, and loan type (Single-Family Housing Guaranteed or Direct Loan Program). The goal is to help families who may struggle to secure conventional financing afford a home in eligible rural areas.
USDA Loan Income Limits for Texas (2024)
As of 2024, the general USDA loan income limits in Texas are as follows:
1-4 Member Household: Up to $110,650 per year
5-8 Member Household: Up to $146,050 per year
These limits apply to most counties in Texas, but some high-cost areas (like parts of Austin or Dallas suburbs) may have slightly higher limits. You can check USDA's website or consult with a mortgage expert to confirm the specific limit in your area.
Factors That Affect USDA Loan Income Limits
Several factors influence your USDA income eligibility:
1. Household Size
Income limits increase as the number of people in your household grows. If you have more than eight members, the USDA allows additional income adjustments.
2. County of Residence
Texas is a vast state with varying living costs. Income limits differ between rural counties and those closer to metropolitan areas. Always check the specific limits for your county.
3. Adjusted Household Income
USDA calculates your adjusted income by considering deductions such as:
- Childcare expenses
- Medical expenses (for elderly or disabled members)
- Elderly household members (62+ years)
If you qualify for these deductions, you may still be eligible even if your gross income is slightly above the limit.
How to Calculate Your USDA Income Eligibility
To determine if you meet USDA income limits, follow these steps:
1. Calculate your gross household income: This includes wages, salaries, bonuses, self-employment income, social security, child support, and any other sources of income.
2. Apply eligible deductions: Subtract allowable expenses like childcare and medical costs.
3. Compare your adjusted income to your county's limit.
If your adjusted income falls at or below the limit, you may qualify for a USDA loan!
Why Income Limits Matter
USDA loans are designed to help families who need financial assistance to buy a home. By setting income limits, the USDA ensures that funds are allocated to those who truly need them rather than high-income earners who may qualify for conventional financing.
What If You Exceed the Income Limit?
If your income is slightly above the limit, you might still qualify if:
- Applying eligible deductions to reduce your adjusted income.
- Adding a co-borrower with lower income.
- Checking other loan options, such as FHA or conventional loans.
Get Pre-Qualified for a USDA Loan in Texas
At Your Lower Mortgage, we specialize in helping first-time homebuyers and families secure the best loan options. If you're interested in a USDA loan in Texas, our team can help determine your eligibility and guide you through the process.
Key Takeaways:
✅ USDA loans offer zero down payment & low interest rates
✅ Income limits depend on household size & location
✅ Adjusted income factors in deductions like childcare & medical expenses
✅ Your Lower Mortgage can help you check eligibility & apply
Ready to Buy a Home?
Contact Your Lower Mortgage today to see if you qualify for a USDA loan in Texas. Let’s make your dream of homeownership a reality.