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USDA Home Loans in Virginia

At Dash Home Loans, we make the mortgage lending process simple. As experienced home loan lenders, we can help you get approved for a USDA loan in Virginia. 

Applying for a USDA home loan doesn’t have to be difficult—Dash is here to help you find the most affordable loans for your needs.

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What Is a USDA Loan?

A USDA home loan is a residential mortgage backed by the U.S. Department of Agriculture. USDA loans are designed to support low- to moderate-income homebuyers while boosting development in rural areas.

Launched by the USDA in 1991, the Single Family Housing Guaranteed Loan program sought to expand the availability of home loans for people looking to live outside city limits. The program has since gained ground and emerged as a popular financing option for qualifying borrowers. 

USDA loans can be a great option for homebuyers with limited cash. That’s because unlike conventional loans, which generally require a down payment of 20%, USDA loans require no money down. Of course, buyers are still expected to pay closing costs as well as annual and upfront guarantee fees. Guarantee fees help loan issuers pay for administrative costs and reduce the risk of loss if you default.


USDA Loan Eligibility in Virginia 

We know what you’re thinking: “0% down? Sign me up!” But not every homebuyer is eligible for a USDA loan in Virginia. To qualify for a USDA loan, you must be purchasing a home in a rural area. To determine if your dream home fits the bill, we suggest using the USDA eligibility map. The USDA eligibility map will help you find areas in Virginia with a population under 20,000, meaning they meet the U.S. Department of Agriculture’s definition of “rural.” You can check out eligibility maps through the USDA. Or, you can make it easy on yourself and talk to one of our Mortgage Coaches for eligibility questions.

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Not sure if you qualify? Contact us today to talk with one of our friendly team members.

USDA Loans in Virginia: Eligibility Areas

There are plenty of quaint mountain towns and charming coastal villages in Virginia to call home. Many of these areas are considered rural by the U.S. Department of Agriculture. If you’ve found a house in Farmville or Damascus, for instance, you’re golden. But you’re probably ineligible for a USDA loan if you’re hunting in or around major cities like Virginia Beach, Chesapeake, Norfolk, Arlington, and Richmond.

Other USDA Loan Eligibility Requirements

To get a USDA loan, you must meet certain income requirements. In Virginia, you cannot make over 15% more than your area’s median income. The exact dollar amount varies by county, though it’s typically about $114,450 per year for a family of four and $151,050 for families of five or more. Your USDA loan application will require income documentation. 

The USDA rural housing loan also specifies other financial requirements. As far as credit, you must have at least a 640 FICO score and a debt-to-income ratio of 41% or less. You must also be able to show consistent employment and an ability to accumulate savings. 

Still not sure if you qualify? Contact the home lending experts at Dash Home Loans. Our Mortgage Coaches are like financial shamans, guiding homebuyers through the mortgage lending process. If your Mortgage Coach determines that a USDA loan isn’t a good fit, we offer more than a dozen other types of home mortgage loans.


Benefits & Disadvantages of USDA Loans

USDA loans make sense for low- to moderate-income individuals who want to live in a rural area. Since no down payment is required, families don’t have to worry about limited cash reserves. Plus, USDA loan rates are often lower than conventional loan rates. 

The most obvious drawback to USDA financing is the geographical restriction. Unless you’re exclusively looking outside city limits, you may fall in love with a home that doesn’t meet the USDA’s location specifications. The income specifications also might not work for all families.   


USDA Loan Requirements for Virginia Borrowers

USDA loan requirements are fairly uniform across the country. To qualify for a USDA loan in Virginia, you must meet the following:

  • Income Limits: You must provide proof of stable employment, but you cannot make over 15% more than your area’s median income. 
  • United States Citizenship: Only permanent residents can apply for a USDA loan. 
  • Mortgage Insurance: USDA loans require mortgage insurance. 
  • Primary Residence in a Rural Area: The home must be located in a rural area and it must be your primary residence, not a vacation home or income property. 

If your family meets these requirements, a USDA loan could be a viable option. After all, this financial instrument requires no money down and typically offers better interest rates than conventional loans.


How To Apply for a USDA Loan in Virginia

Applying for a USDA loan is much like applying for any other home loan. You’ll begin by meeting with your mortgage lender, who will provide all the necessary documents. But at Dash, we do more than drown you in paperwork. We walk you through the loan application process, step-by-step.

Ready to get started? First, apply through Dash’s online system. You’ll then be matched with a Mortgage Coach who will help you gain pre-approval. You will need:

  • Proof of income from W2 and tax returns
  • Proof of your debts to determine your debt-to-income ratio
  • Paycheck stubs
  • Bank statements
  • A photo ID
  • Other documents as requested by your Mortgage Coach

At Dash, we understand that applying for a USDA loan in Virginia can be a huge headache. That’s why we cut out the middle man (i.e. mortgage processors) and streamlined the entire process. Learn more about how we do mortgage lending differently

When can you expect to close on a USDA loan? It depends on the property and your financing team. At Dash, we’re like the Quicksilver of the financial world. We move quickly, anticipating potential snags and additional requirements so that you can enjoy your dream home sooner.

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USDA Loans vs FHA Loans

USDA loans and FHA loans are commonly compared because they’re both government-backed mortgages. While USDA loans are guaranteed by the U.S. Department of Agriculture, FHA loans are guaranteed by the Federal Housing Administration. That doesn’t mean the government is literally issuing you cash, it just means that the respective agency protects the mortgage lender if you default on your loan. 

But what else is different about these two financing options? Well, for starters, USDA loans require no money down. This allows low- to moderate-income families to purchase a house with limited liquid assets. Comparatively, FHA loans require 3.5% down for applicants with a FICO score of 580 and higher. If you have less-than-perfect credit, you may be required to fork out 10% of your total loan amount.

Of course, USDA loans are more limiting in some respects. To qualify for a USDA loan, you must be purchasing a home in a specific geographical area. You must also meet income specifications. There are no location or income restrictions with an FHA loan. 

Learn more about FHA loans in Virginia


USDA Mortgage Lenders in Virginia

Are you looking to get prequalified for a USDA loan? Keep in mind that only USDA-approved mortgage lenders can offer USDA home loans. As a USDA-approved mortgage lender, Dash Home Loans provides Virginia residents with a quick and painless home lending process. 

Want to learn more? Contact Dash online or give our mortgage lenders a call at 757-280-1994 today!

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Frequently Asked Questions

Virginia USDA Home Loan FAQs

What is a USDA home loan?

A USDA home loan is a residential loan guaranteed by the U.S. Department of Agriculture. These loans are designed to help low- to moderate-income individuals secure financing for properties located in rural areas. 

What are USDA loan closing costs?

Closing costs vary depending on the lender. Typically, however, USDA loan closing costs are three to 5% of the purchase price.

How much will a USDA loan approve me for?

Your USDA home loan limit is based on your financial circumstances. Individuals with a higher income and credit score will generally be approved for a larger loan.

What is a USDA eligible area?

A USDA eligible area must meet the U.S. Department of Agriculture’s definition of “rural.” Typically, rural areas have a population that is less than 20,000. You can check out eligibility maps through the USDA.

What is the income limit for USDA home loans?

To qualify for a USDA home loan in Virginia, you cannot make over 15% more than your area’s median income.