Louisiana USDA Rural Development Loans

The USDA Rural Development allows homebuyers in Louisiana to purchase a home without a down payment & competitive interest rates. 

USDA Rural Development Loan Louisiana
Rural Development Loan Louisiana

What is the Rural Development Loan?


The Rural Development loan is a 100% financed home loan program insured by the United States Department of Agriculture or USDA for short.

  The goal of the USDA Rural Development Loan is to build home ownership in less population dense communities.  However don’t let the name fool you. USDA loans are great programs for anyone looking to purchase a home in suburban and more rural areas.

Basically anything typically located outside of major city limits will qualify. 

USDA Rural Development Loan Guide

USDA Loan Louisiana
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Louisiana USDA Rural Development Requirements

Understanding Louisiana Income Limits for USDA Loans

Navigating the USDA loan process in Louisiana means understanding the specific income requirements set forth for eligibility. Here’s a brief overview tailored for Louisiana residents:

  • Standard Income Limits: For families comprising 1-4 members in Louisiana, the USDA has set an average household income limit at approximately $110,650.
  • Extended Income Limits: Recognizing the varied needs of larger families, the USDA adjusts its income limits accordingly. For households with 5-8 members or more, the income limit can increase to as much as $146,050.
  • Why Income Limits Matter: These income limits are crucial as they ensure that USDA loans are accessible to those who fall within the low to moderate-income bracket, thereby promoting homeownership in rural areas of Louisiana.
  • Expert Guidance: Understanding these limits can be tricky, and that’s where our USDA loan specialists come in. They are equipped to offer personalized advice, helping you navigate the complexities of the USDA loan requirements.
  • Next Steps: To learn more about your eligibility and to take steps towards securing your new home with a USDA loan, reaching out to a USDA loan specialist is your best course of action. They can provide detailed information, answer any queries, and help you understand the full scope of USDA loan benefits.

Remember, USDA loan specialists are your partners in this journey, offering insights and guidance tailored to your unique financial situation.

Get in touch with one today to explore your options and embark on the path to homeownership in Louisiana.

Louisiana USDA Loan Requirements

USDA loans, offered by the United States Department of Agriculture, are designed to assist low-to-moderate income buyers in purchasing homes in rural areas.

Eligibility Requirements

  •  Property Location: The home must be located in an area designated as rural by the USDA. Most areas outside of major cities in Louisiana qualify.
  • Income Limit: Your household income must not exceed 115% of the median income for the area. The limits vary by county and household size.
  • Credit Score: While the USDA does not set a minimum credit score, most lenders require a score of at least 640.
  • Citizenship: Applicants must be U.S. citizens, U.S. non-citizen nationals, or Qualified Aliens.
  • Occupancy: Borrowers are required to occupy the home as their primary residence.
    Financial Requirements:
  • Debt-to-Income Ratio: Typically, the USDA requires a debt-to-income ratio (DTI) of 41% or less, though exceptions can be made if your credit score is above a certain threshold.
  • Stable Income: Applicants should have a steady and dependable income, typically for a minimum of 24 months.
  • Credit History: A history of timely payments and responsible credit use is expected, although certain allowances are made for infrequent issues.
  • Property Condition: The home must be in good repair and meet the USDA’s standards for safety and habitability.
  • No Down Payment: USDA loans typically do not require a down payment.
  • Loan Term: Typically, USDA loans are 30-year, fixed-rate mortgages.
  • Guarantee Fee: There is an upfront guarantee fee, which is 1% of the loan amount, and an annual fee of 0.35% of the loan balance.

USDA Rural Development Loan Benefits

Zero Down Payment

USDA loans require no down payment, making homeownership attainable without upfront cash.

Low Interest Rates

These loans offer interest rates that are often lower than standard rates, reducing monthly payments.

Less Than Perfect Credit Ok

Flexible credit guidelines allow for lower credit scores, opening doors for more buyers.

Higher Income Limits

USDA loans have higher income limits compared to many down payment assistance programs, accommodating a wider income range.

Applying for a Louisiana USDA Loan: A Step-by-Step Guide

To apply for a USDA loan in Louisiana, follow these essential steps to navigate the process efficiently:

1. Eligibility Check: First, determine your eligibility by ensuring you meet the income requirements and that your desired property is in a USDA-approved rural area. The USDA’s online tool can help you confirm this.

2. Pre-Approval: Secure a pre-approval from a USDA-approved lender. This involves submitting financial documents like tax returns, pay stubs, and bank statements. Pre-approval will give you an idea of your budget and strengthens your position as a buyer.

3. Find a USDA-Approved Lender: Not all lenders are  USDA-approved. Find one that specializes in USDA loans in Louisiana to guide you through the application nuances specific to the state.

4. Property Search: With your pre-approval in hand, search for properties within USDA-eligible areas. Stick to your pre-approved budget to ensure affordability.

5. Loan Application: Once you have a property in mind, complete the official loan application. Your lender will request additional information and complete the underwriting process.

6. Home Inspection and Appraisal: A thorough home inspection is crucial, and the USDA requires a separate appraisal to ensure the property meets their guidelines.

7. Loan Approval and Closing: If the appraisal is satisfactory and your financials remain consistent, you’ll receive final loan approval. Afterward, you’ll attend the closing, sign the paperwork, and the property will be yours.

Remember to consult with a USDA loan specialist early in the process, as they can provide invaluable advice and help you avoid common pitfalls. 

Louisiana USDA Mortgage Rates

In the realm of home financing, the interest rate holds significant weight. For those exploring USDA loans in Louisiana, the allure lies in their advantageous rates, which frequently position them as a top selection among state residents looking to buy a home. As these rates are subject to the ebb and flow of broader economic influences, maintaining current knowledge of rate trends is crucial.

Rural Development FAQ's

Louisiana USDA Loan FAQ's


The USDA is fairly flexible on the different types of homes you can purchase using the program.  These home types include: 

  • New Construction Homes
  • Preexisting Homes
  • Townhomes
  • Condos
  • Manufactured Homes
  • Modular Homes
Homes that you may have difficulty purchasing would be Farms, Large Tract Acreage, Foreclosures and Short Sales.  For foreclosures and short sales the biggest determining factor will be property condition. If they are move in ready it should be ok. However if any of these homes need work they likely won’t qualify to purchase using this program.

1. No Down Payment

2. Low Interest Rates

3. Low Monthly Mortgage Insurance 

4. Flexible Credit Requirements 

5. Ability to Roll Closing Costs Into The Loan 

6. Most of Louisiana Qualifies


1. Primary residence only 

2. Have to buy in areas considered rural

3. Income limits restrict who can qualify 

4. Low debt-to-income ratio requirements

It typically takes between 30 and 45 days to get approved for a USDA Rural Development loan.  Rural Development loans take slightly longer than other loan programs because they must be reviewed by the USDA before final approval can be issued. Louisiana is also an extremely popular USDA Loan state, so turn times range between a few days and up to 3 weeks to get this reviewed. 

The easiest way to get started with a USDA Rural Development Loan is to take our quick 60 second pre-qualification quiz. There is no social or credit check required. Once you complete this form one of our licensed USDA loan experts will reach out to you to discuss your qualification. 

How To Apply for a USDA Loan 


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