On this page
NMLS#: 2072896 (Company) · 513013 (Adam Styer)
What Is a USDA Loan?
If you are looking outside Austin proper, the question I start with is whether USDA will even take the address. USDA loans are mortgages guaranteed by the U.S. Department of Agriculture Rural Development program. They can finance a primary home with no down payment when the household is under an income cap and the property is on the current map.
That is not only farmland. Addresses I check include Bastrop, Wimberley, Liberty Hill, and Marble Falls, and only when that specific parcel is inside the boundary. If you work in Austin and the house is outside the city, I check the map before you write an offer.
USDA-Eligible Areas Near Austin
Several counties and communities surrounding Austin qualify for USDA financing:
- Bastrop County — Bastrop, Elgin, Smithville, Cedar Creek
- Caldwell County — Lockhart, Luling, Martindale
- Hays County (rural areas) — Wimberley, Dripping Springs (some areas), Buda outskirts
- Williamson County (rural areas) — Taylor, Granger, Florence, Bartlett, Liberty Hill (some areas)
- Burnet County — Marble Falls, Burnet, Bertram
- Blanco County — Johnson City, Blanco
- Lee County — Giddings, Lexington
The map changes. Ask me to check an address before you start house hunting.
Thanks! Adam will reach out within 1 business day.
USDA Loan Benefits
Zero Down Payment
True 100% financing — no down payment required. One of only two loan programs (along with VA loans) offering zero-down options.
Low Mortgage Insurance
Just 1.0% upfront guarantee fee and 0.35% annual fee — significantly lower than FHA mortgage insurance (1.75% upfront, 0.55% annual).
What I compare with FHA
I put USDA next to FHA on the same house. The smaller guarantee fee only matters if the address and the household income both pass. I do not quote USDA as a rate special.
Flexible Credit Requirements
Minimum credit score of 640 for automated approval. Manual underwriting available for scores as low as 580 with compensating factors.
Seller Concessions Allowed
Sellers can contribute up to 6% of the purchase price toward your closing costs, reducing the cash you need to close.
Finance Closing Costs
If the appraised value exceeds the purchase price, you can roll closing costs into the loan — potentially making it a true zero-cash-to-close mortgage.
USDA Loan Requirements
Income Limits
USDA loans are income-restricted. Your total household income (all adults in the home, not just borrowers) cannot exceed 115% of the area median income. For most counties near Austin, the 2026 limits are:
- 1-4 person household: $112,450
- 5-8 person household: $148,450
Certain deductions (childcare costs, dependents, elderly household members) can reduce your qualifying income below the limit.
Property Eligibility
The property must be located in a USDA-designated rural area, used as your primary residence, and meet minimum property standards. Condos, townhomes, single-family homes, and manufactured homes on permanent foundations all qualify.
Credit Score
A 640 credit score qualifies for automated underwriting (GUS — the USDA's approval system). Scores between 580-639 may qualify through manual underwriting with compensating factors like low DTI, stable employment, or savings reserves.
Debt-to-Income Ratio
Standard USDA DTI limits are 29% for housing costs and 41% for total debt. With strong compensating factors, the total DTI can flex up to 44% through automated approval.
USDA Guarantee Fee
USDA charges two fees instead of traditional PMI:
- Upfront guarantee fee: 1.0% of the loan amount (can be financed into the loan)
- Annual fee: 0.35% of the remaining balance (paid monthly)
On a $250,000 loan, the annual fee adds approximately $73/month — about $50 less than FHA mortgage insurance on the same amount.
USDA Loan FAQ
Many areas surrounding Austin qualify, including parts of Bastrop County, Caldwell County, Hays County (outside city limits), Williamson County (rural areas), Burnet County, and Blanco County. Towns like Bastrop, Lockhart, Wimberley, Taylor, Liberty Hill, and Marble Falls often qualify. Ask me to check an address.
For most counties near Austin, the 2026 income limit is $112,450 for 1-4 person households and $148,450 for 5-8 person households. These limits apply to total household income, not just the borrower's income. Certain deductions may reduce your qualifying income.
Yes — USDA offers true 100% financing. You can even finance closing costs if the appraised value exceeds the purchase price, and sellers can contribute up to 6% toward closing costs. It is possible to close with zero cash out of pocket.
USDA mortgage insurance is significantly cheaper: 1.0% upfront (vs. FHA 1.75%) and 0.35% annual (vs. FHA 0.55%). Compare the USDA annual fee with FHA mortgage insurance on the same house.
USDA loans work for existing homes, new construction, and manufactured homes on permanent foundations. The property must be your primary residence in a USDA-eligible area. Investment properties and vacation homes do not qualify.
Explore Other Loan Programs
Helpful articles: First-Time Buyer's Guide · Down Payment Assistance · How Much House Can I Afford?
★ 5.0 Google rating · 4.98 Zillow rating · 144 total reviews
"As a first-time buyer, I had a million questions. Adam was patient, responsive, and got me an amazing rate." — Ihor, Austin TX
Does this address qualify?
Send me the address and the household size. I will tell you if USDA is even on the table.
Related guides