USDA Home Loan Program in North Carolina

Looking to buy a home in North Carolina but not sure where to start? If you’re considering a USDA Home Loan, there are some specific areas in the state that are eligible for this type of financing. In general, you are looking for a spot that is outside of an Incorporated City Limit.  We love the USDA Home Loan Program in North Carolina, because it has so many benefits, even if you aren’t a first time home buyer! Remember, credit score requirements are lower for this program than Conventional Loans, and there’s No Down Payment required for a USDA Home Loan in NC!

Regions and Counties that qualify for USDA Home Loan Program in North Carolina

1. Rural Areas: USDA Home Loans are designed to help homebuyers in rural areas who have lower incomes and may not be able to obtain traditional financing. In North Carolina, any area that is not considered urban or suburban is typically eligible for a USDA Home Loan.  In fact, all 100 NC Counties have a portion that will qualify for the program!  So, downtown Fuquay Varina (for instance) no longer qualifies, but once you are outside of the incorporated city limits, it does.
2. County Eligibility: In addition to considering the location, USDA Home Loans are also based on county eligibility, when it comes to income limits for the household. Certain counties in North Carolina have higher income eligibility than others.  For instance, Edgecomb and Nash County (where Rocky Mount is) has a limit of $110,650 and Wake County has an Income limit of $130,300 for 1 to 4 people in a family for the USDA Guaranteed Home Loan program.  For a family over 5 in Wake County the new limit is $172,000.
3. Income Requirements: To qualify for a USDA Home Loan, your income must fall within the limits set by the USDA each year. The income limits vary based on the county and the size of your household. For the Guaranteed Program that we offer, generally, the income limits are higher in more rural areas of North Carolina.  Most NC Counties have a limit at $110,650 for 1 to 4 people in household, and then $146,050 for 5 or more.
4. Property Requirements: Properties purchased with a USDA Home Loan in NC must meet certain requirements, such as being located in an eligible area and being a primary residence. Every County in NC has a portion that is eligible for the program.  Some Counties (like Durham) have a VERY limited area – but you can still use the program in each NC County.  We work with GREAT Real Estate Agents across the state, and we can help you find a USDA Eligible home.
5. USDA has extended the non-U.S. citizen temporary eligibility for two years.  Non-U.S. citizens with a valid social security number and unexpired EAD card (Employment Authorization Document) are temporarily eligible through May 2, 2025.  This is GREAT news for Dreamers and DACA’s who want to buy a home in NC with no down payment.
6. Other Benefits of USDA Home Loans in NC: USDA home loans offer several benefits, including no down payment requirement and low interest rates. They are also available to borrowers with lower credit scores and limited credit histories.  In general, the USDA Automated Underwriting System requires a minimum credit score of 640.  However, we can get loans approved with lower scores with a manually underwritten loan.  Mortgage rates for a manually underwritten loan are generally a little higher, but it’s worth it to buy a house!  The monthly mortgage insurance for the program is also very low compared to most other program types.

Some of the counties in North Carolina that are eligible for USDA Home Loans include Anson, Caswell, Chatham, Franklin, Guilford, Granville, Harnett, Johnston, Lee, Moore, Nash, Orange, Person, Randolph, Vance, Wake, and Warren. Keep in mind that these eligibility requirements change each year.  In general, if a rural area is incorporated into a City Limit which is happening pretty often in Fuquay Varina (for instance) then it will likely loose it’s eligibility for the program.

If you’re considering a USDA Home Loan in North Carolina, please call Steve and Eleanor Thorne 919 649 5058.  We are experts when it comes to this program, we’ve helped thousands of customers buy houses in NC with the USDA Home Loan Program, and we would love to help you too!!