Dreaming of a home in the country but don’t have a large income to qualify for a mortgage loan? Homeownership could still be withing reach thanks to an under-the-radar government program. A lot of potential homebuyers don’t realize that they might qualify for 100% financing of a home through the U.S. Department of Agriculture (USDA) Rural Development. 

The government program provides loans for low-income families to purchase homes in rural communities. The money can be used to buy an existing or newly constructed home, or to build a home. Funds are also available to repair, renovate or relocate a home.

So exactly who qualifies for help through this program? The Rural Housing Direct Loan requires borrowers to have very low incomes that are 50% below the median income  in their area, or low incomes between 50% and 80% of the median income. The Rural Housing Guaranteed Loan requires that applicants have an income of up to 115% of the median income in their area. The USDA  has a guide that can help you determine your eligility for loans.

Applicants for the loan programs also:

• Must not currently have adequate housing
• Must not qualify for credit from other sources, but have a reasonable credit history
• Must be able to afford monthly mortgage payments, including taxes and insurance.

Usually loan applicants are expected to have a credit score of around 640 to qualify for loans, but there may be some wiggle room depending upon how they’ve handled their finances. Also, income eligibility will be based upon all members of your household who work, even if they aren’t listed on the application.