Navigating USDA RD Loans in Arkansas: An In-Depth Guide and Map of Eligibility

You can use this USDA eligibility map to find USDA-eligible homes in your area. Look up the address you’re interested in purchasing to verify it falls within a rural area, as determined by the U.S. Department of Agriculture.

As an Arkansas resident exploring home financing options, you may have come across USDA Rural Development (RD) loans With their 100% financing and flexible credit guidelines, RD loans (also called USDA home loans) can be a great option – especially if you want to buy in a rural area.

But how do you know if you’re eligible for a USDA mortgage in Arkansas? Can you use it in any part of the state, or are there geographic restrictions?

This comprehensive guide will explain everything you need to know about RD loans in Arkansas We’ll cover

  • USDA Loan Overview and Benefits
  • Eligibility Requirements
  • USDA RD Loan Areas Map and Boundaries
  • How to Check Property Eligibility
  • Applying for a USDA Mortgage in Arkansas
  • Tips for Finding an Arkansas USDA Lender

Let’s dive in and shed light on USDA loan availability across The Natural State.

Overview of USDA RD Loans

USDA Rural Development loans, also called Section 502 loans, are a special type of zero-down mortgage for eligible home purchases in designated rural and suburban locales.

As a government program, their purpose is to help low-to-moderate income buyers achieve homeownership in smaller towns and communities.

Some of the key benefits include:

  • 100% Financing – No down payment required
  • Low Rates – Below market fixed interest rates
  • Flexible Credit – No minimum score, but typically 620+
  • Low Mortgage Insurance – 1% upfront fee
  • No Income Limits – Based on property, not income

USDA RD loans offer affordable financing and require no money down, making them one of the few true zero-down mortgages today. Borrowers still pay closing costs and mortgage insurance.

Am I Eligible for a USDA Loan in Arkansas?

To qualify for a USDA mortgage in Arkansas, you must meet certain borrower eligibility requirements:

Borrower Criteria:

  • Credit Score – Usually 620+ but no minimum
  • Debt-to-Income Ratio – Under 29%/41% front/back end
  • Income Verification – 2 year history
  • First-Time Homebuyer – Not required but focused on

You also must ensure the property itself meets USDA guidelines. The home must be located in a designated rural area and meet HUD quality standards. Income limits do not apply – eligibility is based on the home’s location.

Where are USDA Loans Available in Arkansas?

USDA RD loans are only available in certain approved rural and suburban areas of Arkansas. Properties in the city limits of Little Rock or Fayetteville, for example, would not qualify.

Luckily, USDA-eligible areas cover most of the state’s smaller towns and communities outside of major metro hubs.

This map shows where USDA loans are currently available in Arkansas:

[insert map showing eligible areas]

A few key notes on USDA mortgage boundaries in Arkansas:

  • Eligible areas are shown in green
  • Major cities like Little Rock and Fayetteville are ineligible
  • 97%+ of Arkansas land area qualifies based on location
  • Coastal/southern regions have highest eligibility

So while geographic restrictions exist, a vast majority of the state is covered.

How to Check USDA Eligibility for an Arkansas Property

Verifying whether a specific property meets USDA Rural Development loan requirements is easy:

1. Review Eligibility Maps

Check online maps to see if the home’s location falls within an eligible area.

2. Use USDA Address Eligibility Tool

Go to USDA’s eligibility website and enter the property’s address. It will confirm if USDA-approved for that location.

3. Ask a USDA Lender

A lender specializing in RD loans can determine if the property meets eligibility guidelines.

4. Check with USDA Directly

You can call the Arkansas USDA Rural Development office to ask about a property’s status.

Doing your homework upfront ensures no surprises later in the mortgage process. Avoid applying for a USDA loan on an ineligible home.

Applying for a USDA RD Home Loan in Arkansas

If you’ve determined you meet eligibility requirements, follow these steps to apply for a USDA mortgage in Arkansas:

1. Check Your Credit

Strong credit in the 620-680 range or higher is recommended for approval. Review your credit reports and score beforehand.

2. Get Pre-Qualified

Work with a USDA lender to assess your finances and get a pre-approval letter stating your estimated loan amount.

3. Find a USDA-Eligible Home

Start home shopping within an approved area in your target price range.

4. Make an Offer & Apply

Once your offer is accepted, complete a full USDA loan application with your lender.

5. Get an Appraisal

The lender will order an appraisal to ensure the home meets USDA value and condition requirements.

6. Close on Your USDA Loan!

At closing, you’ll sign final loan documents and receive the keys to your new home!

Getting pre-qualified early makes for a smoother experience. Work closely with your lender and real estate agent to search for eligible properties from the start.

Tips for Finding a USDA Lender in Arkansas

Not all mortgage lenders offer USDA home loans. Here are some tips for choosing a lender:

  • Find an approved USDA lender familiar with RD program guidelines
  • Search Arkansas lenders with specialized USDA loan experience
  • Compare interest rates and fees from multiple loan officers
  • Look for local lenders active in your target home buying markets
  • Ask your real estate agent for USDA lender recommendations

Shopping around helps ensure you get the best deal. Online lenders like LendingTree also provide easy rate comparisons.

The Bottom Line on USDA Loans in Arkansas

As you can see, USDA Rural Development loans open up affordable financing to eligible buyers across most non-metropolitan regions of Arkansas.

Just be sure to verify a property’s eligibility before applying. Use the resources above to map out and check potential home locations upfront. An Arkansas USDA lender can also guide you.

While not available everywhere, when used strategically in qualified rural zones, USDA mortgages can be a game-changer making homeownership achievable for more Arkansas residents.

USDA Loan Property Eligibility Requirements

Though USDA loans are often referred to as rural housing loans, you don’t have to live in the country or purchase farmland to use them. In fact, you might be surprised at just how much of the country is actually eligible for these loans.

According to the Housing Assistance Council, a whopping 97% of U.S. land is located within USDA-eligible boundaries. Those areas claim about 109 million Americans — or around a third of the country’s entire population.*

Buyers in large cities and more densely populated suburbs aren’t eligible for these loans, but many living in surrounding towns and cities may be. An area with a population of 35,000 or less can be considered “rural” in the USDA’s eyes.

The easiest way to determine USDA property eligibility is to look up the address in the map above. Simply type the property address into the tool, press enter, and you’ll see if the home is eligible for USDA financing. If the property shows up in a shaded area of the USDA eligibility map, it is not currently eligible.

USDA Eligibility Map: Verify an Address

Areas in red are not currently eligible for a USDA-backed loan.

Buying a House Using USDA Rural Development Loan ($1,000 DOWN)

FAQ

What is the income limit for a USDA loan in Arkansas?

Eligibility Requirements – Arkansas For a family of 1-4, the income limit for a USDA loan is $110,650 and families of 5+ have a cap of $146,050. Not only that, but USDA loans can be 100% financed, which means no down payment.

How accurate is the USDA eligibility map?

If you already have a specific home in mind, you can use the USDA loan map to check that address. However, just because a property is in an area designated as rural on the USDA loan map, it doesn’t guarantee that you’ll be able to finance it with a USDA loan.

What credit do you need for a USDA RD loan?

What is the minimum credit score for a USDA loan? Approved USDA loan lenders typically require a minimum credit score of at least 620 to get a USDA home loan. However, the USDA doesn’t have a minimum credit score, so borrowers with scores below 620 may still be eligible for a USDA-backed mortgage.

What is the USDA loan limit for 2024?

Loan Limits USDA guaranteed mortgages do not have a maximum defined loan limit. As of March 2024, most of the rural areas USDA guaranteed loans cover have a standard limit of $398,600. Higher cost counties have higher limits between $431,400 and $919,800.

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