USDA Property Eligibility

In order to receive a USDA mortgage, the property must also be located in an eligible rural area as determined by USDA.

What Qualifies as a Rural Area?

In order to be an eligible property, rural areas are generally defined by USDA as:

• Open country that is not part of, or associated with, an urban area;
• Any town, village, city, or place, including the immediately adjacent densely settled area, which is not part of, or associated with, an urban area, and which:
  • Is rural in character with a population of less than 10,000; or
  • Is not contained within an MSA (Metropolitan Statistical Area) and has a population above 10,000 but below 20,000 and has a serious lack of mortgage credit for lower and moderate income families.
• Two or more towns, villages, cities, or places that are contiguous may be considered separately for a rural designation if they are not otherwise associated with each other, and their densely settled areas are not contiguous.

USDA Minimum Property Requirements (MPRs)

To ensure the house meets USDA guidelines, a qualified appraiser will inspect the property to ensure it meets the minimum property requirements set forth in HUD’s Single Family Housing Policy Handbook 4000.1 (SF Handbook).