If you are willing to live in a rural area, you have the benefit of applying for USDA financing. As long as you meet the maximum income guidelinesfor your area (you don’t make too much money), you may qualify. But how do you know which houses qualify for this financing?
There are a few ways for you to find out.
The USDA Website
The USDA website will have the most up-to-date information regarding which areas the USDA considers rural. You can put a complete address in the address bar on the map you can zoom in and look at the overall areas that qualify. This will give you a general idea of where you need to be when using USDA financing.
This is as close to a ‘magic list of rural homes,’ that the USDA will provide. In other words, you must do your homework first and then consult with the USDA website to see if the property qualifies.
Searching the Real Estate Websites
Once you know the areas that the USDA considers rural, it’s time to find actual homes that you want to see. Knowing the areas that you want to stay within, you can find listings on sites like Zillow, Redfin, or Realtor.com. These sites will give you the address of the homes you may be interested in. You can then take those addresses and put them in the USDA eligibility map to see if they are USDA eligible.
The Home Must Pass Inspection
Once you find a home that falls within the USDA boundaries, you have to worry about the home passing the inspection. This means some or all of the following:
- The home must be modest (it can’t be larger than the average home in the area)
- You can’t use the home for commercial purposes
- You must be able to directly access the home from the road
- All utilities must be in good working condition
- You must be able to move into the home right away
- There cannot be any termite, mold, or pest damage
Even if you think the home passes these criteria, you must pay for an appraisal and an inspection. This will let the lender know the fair market value of the home as well as its status. For example, does it meet all the building codes? Are there signs of mold damage? Is the home not livable without certain repairs?
These are things the USDA needs to know in order to pass the home for USDA financing.
While there isn’t a magic listing of USDA homes, you can make finding a USDA easy on yourself by using the USDA property eligibility map. This map, which only changes with ever census tract, will give you the most up-to-date information regarding eligible properties in your area.