USDA Loan Alabama

What are Alabama USDA Loans?

USDA offers two types of USDA home loans in the state of Alabama: Direct and Guaranteed. Most borrowers choose the guaranteed option because there are less restrictions. The guaranteed is through a private lender and the USDA backs the loan and enforces guidelines. 

USDA Guaranteed Home Mortgage Loans are the most common type of USDA Loan in Alabama and allow for higher income limits and 100% financing for home purchases. USDA Guaranteed Loan applicants may have an income of up to 115% of the median household income for the area. Area income limits for this program can be viewed on USDA's website. All USDA Guaranteed Loans carry 30-year terms and are set at a fixed rate.

USDA Direct Housing Loans are less common than USDA Guaranteed Loans and are only available to low and very low-income households, as defined by the USDA. Very low income is defined as below 50 percent of the area median income (AMI); low income is between 50 and 80 percent of AMI; moderate income is 80 to 100 percent of AMI.

What Are The USDA Eligibility Requirments In Alabama? 

More often than not most areas of the state fall into the following categories. For households of 1-4 people, the maximum income is $86,850 and for households with 5 or more people the maximum income is $114,500. The USDA map shows the eligible areas in the state of Alabama. Here is a chart of all the areas it's throughout the state.

Anniston-Oxford-Jacksonville, AL MSA
VERY LOW INCOME 28100 28100 28100 28100 37100 37100 37100 37100
LOW INCOME 44950 44950 44950 44950 59350 59350 59350 59350
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Auburn-Opelika, AL MSA
VERY LOW INCOME 35550 35550 35550 35550 46950 46950 46950 46950
LOW INCOME 56900 56900 56900 56900 75100 75100 75100 75100
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Birmingham-Hoover, AL MSA
Birmingham-Hoover, AL HUD Metro FMR Area
VERY LOW INCOME 37200 37200 37200 37200 49150 49150 49150 49150
LOW INCOME 59500 59500 59500 59500 78550 78550 78550 78550
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Chilton County, AL HUD Metro FMR Area
VERY LOW INCOME 27650 27650 27650 27650 36500 36500 36500 36500
LOW INCOME 44250 44250 44250 44250 58400 58400 58400 58400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Walker County, AL HUD Metro FMR Area
VERY LOW INCOME 25850 25850 25850 25850 34150 34150 34150 34150
LOW INCOME 41350 41350 41350 41350 54600 54600 54600 54600
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Columbus, GA-AL MSA
VERY LOW INCOME 29800 29800 29800 29800 39350 39350 39350 39350
LOW INCOME 47700 47700 47700 47700 62950 62950 62950 62950
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Daphne-Fairhope-Foley, AL MSA
VERY LOW INCOME 37650 37650 37650 37650 49700 49700 49700 49700
LOW INCOME 60250 60250 60250 60250 79550 79550 79550 79550
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Decatur, AL MSA
VERY LOW INCOME 31400 31400 31400 31400 41450 41450 41450 41450
LOW INCOME 50250 50250 50250 50250 66350 66350 66350 66350
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Dothan, AL MSA
Dothan, AL HUD Metro FMR Area
VERY LOW INCOME 28700 28700 28700 28700 37900 37900 37900 37900
LOW INCOME 45900 45900 45900 45900 60600 60600 60600 60600
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Henry County, AL HUD Metro FMR Area
VERY LOW INCOME 29150 29150 29150 29150 38500 38500 38500 38500
LOW INCOME 46650 46650 46650 46650 61600 61600 61600 61600
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Florence-Muscle Shoals, AL MSA
VERY LOW INCOME 31600 31600 31600 31600 41750 41750 41750 41750
LOW INCOME 50550 50550 50550 50550 66750 66750 66750 66750
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Gadsden, AL MSA
VERY LOW INCOME 28550 28550 28550 28550 37700 37700 37700 37700
LOW INCOME 45700 45700 45700 45700 60300 60300 60300 60300
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Huntsville, AL MSA
VERY LOW INCOME 42450 42450 42450 42450 56050 56050 56050 56050
LOW INCOME 67900 67900 67900 67900 89650 89650 89650 89650
MOD.INC-GUAR.LOAN 97600 97600 97600 97600 128850 128850 128850 128850
Mobile, AL MSA
VERY LOW INCOME 30300 30300 30300 30300 40000 40000 40000 40000
LOW INCOME 48500 48500 48500 48500 64000 64000 64000 64000
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Montgomery, AL MSA
VERY LOW INCOME 32950 32950 32950 32950 43500 43500 43500 43500
LOW INCOME 52700 52700 52700 52700 69550 69550 69550 69550
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Tuscaloosa, AL MSA
Pickens County, AL HUD Metro FMR Area
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Tuscaloosa, AL HUD Metro FMR Area
VERY LOW INCOME 33450 33450 33450 33450 44200 44200 44200 44200
LOW INCOME 53500 53500 53500 53500 70600 70600 70600 70600
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Barbour County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Bullock County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Butler County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Chambers County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Cherokee County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Choctaw County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Clarke County, AL
VERY LOW INCOME 26700 26700 26700 26700 35250 35250 35250 35250
LOW INCOME 42700 42700 42700 42700 56350 56350 56350 56350
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Clay County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Cleburne County, AL
VERY LOW INCOME 26450 26450 26450 26450 34950 34950 34950 34950
LOW INCOME 42300 42300 42300 42300 55850 55850 55850 55850
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Coffee County, AL
VERY LOW INCOME 32950 32950 32950 32950 43500 43500 43500 43500
LOW INCOME 52700 52700 52700 52700 69550 69550 69550 69550
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Conecuh County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Coosa County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Covington County, AL
VERY LOW INCOME 26450 26450 26450 26450 34950 34950 34950 34950
LOW INCOME 42300 42300 42300 42300 55850 55850 55850 55850
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Crenshaw County, AL
VERY LOW INCOME 26700 26700 26700 26700 35250 35250 35250 35250
LOW INCOME 42700 42700 42700 42700 56350 56350 56350 56350
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Cullman County, AL
VERY LOW INCOME 26550 26550 26550 26550 35050 35050 35050 35050
LOW INCOME 42500 42500 42500 42500 56100 56100 56100 56100
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Dale County, AL
VERY LOW INCOME 29750 29750 29750 29750 39300 39300 39300 39300
LOW INCOME 47600 47600 47600 47600 62850 62850 62850 62850
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Dallas County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
DeKalb County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Escambia County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Fayette County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Franklin County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Greene County, AL
VERY LOW INCOME 28250 28250 28250 28250 37300 37300 37300 37300
LOW INCOME 45200 45200 45200 45200 59650 59650 59650 59650
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Jackson County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Lamar County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Macon County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Marengo County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Marion County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Marshall County, AL
VERY LOW INCOME 27350 27350 27350 27350 36150 36150 36150 36150
LOW INCOME 43750 43750 43750 43750 57750 57750 57750 57750
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Monroe County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Perry County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Pike County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Randolph County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Sumter County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Talladega County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Tallapoosa County, AL
VERY LOW INCOME 26850 26850 26850 26850 35450 35450 35450 35450
LOW INCOME 42950 42950 42950 42950 56700 56700 56700 56700
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Washington County, AL
VERY LOW INCOME 28350 28350 28350 28350 37450 37450 37450 37450
LOW INCOME 45350 45350 45350 45350 59850 59850 59850 59850
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Wilcox County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650
Winston County, AL
VERY LOW INCOME 25750 25750 25750 25750 34000 34000 34000 34000
LOW INCOME 41200 41200 41200 41200 54400 54400 54400 54400
MOD.INC-GUAR.LOAN 86850 86850 86850 86850 114650 114650 114650 114650

Outside of income and qualifying areas there are several other USDA requirements. The first is the credit score. For most lenders the minimum credit score is 640. Borrowers are required to be 2 years removed from bankruptcy and 3 years from foreclosure. Also, USDA Loans now require at least 3 tradelines with a 12-month history but alternative credit can be used in lieu.

What is the maximum amount that can be borrowed?

USDA Loans actually do not have a maximum loan amount. The debt to income ratio will determine the max loan amount on each loan because the borrowers will be limited on loan amount by their ratios. The max ratios are 28% and 41%. Additionally, your total household monthly income must be within USDA's allowed maximum income limits for your area. Maximum USDA Guaranteed Loan income limits for your area can be found at www.usda.gov.

Closing costs vary, but borrowers can have the seller pay up to 6% of the sales price towards their closing cost. In most cases this is more than enough to cover all closing costs.