The Section 502 Direct Loan Program, also known as USDA Direct Loans, is a program that aids low and very-low-income individuals purchase decent healthy, safe and clean housing in eligible rural areas. That’s accomplished though offering payment assistance which boosts a borrower’s capacity to repay. This payment assistance can be described as a form of subsidy that lowers the mortgage repayment for a brief period, and the amount of assistance is contingent upon the adjusted family income. USDA Section 502 Direct Loans in Iowa aren’t the same thing as USDA Section 502 Guaranteed Loans in Iowa. The USDA Guaranteed Loan Program is more popular and accommodates a wider range of applicant incomes.

Can I get a USDA Direct Loan in Iowa?

USDA Loan RequirementsUSDA Direct Loans in Iowa are low income loans that can be used to purchase homes in rural areas. To qualify for Direct Loans, applicants must have low or very low income, which is defined by the USDA as 50% to 80% of the Area Median Income (AMI). Like other rural housing loan programs, USDA Direct Loans are a mortgage with no down payment. The median income for the entire state of IA is $60,523, although that figure may vary from county to county. The maximum yearly income limits for Iowa USDA Direct Loan approval are listed below. Other than meeting Iowa USDA Direct Loan income limits, applicants must adhere to the following criteria to be eligible:

  • You have no decent clean, safe, and sanitary housing presently.
  • You can’t be able to get a mortgage from another source with terms and conditions that could reasonably expected to be met.
  • You must use this property for your primary residence.
  • You must possess the legal capacity to be able to contract a loan
  • You must meet citizenship or eligible noncitizen requirements.
  • You can’t be barred or suspended from participation in federal programs.

Additionally, the subject property must meet the following conditions:

  • Be a modestly sized home for that area.
  • Market value can’t be in excess of the areas applicable loan limit.
  • Can’t be designed for the production of income.

What areas in IA are eligible for USDA Direct Loans?

The property in question must be in an approved rural area. USDA Rural Development provides a webpage where you can search specific addresses in IA here.

How much can I borrow with a USDA Direct Home Loan?

The size of the mortgage that an applicant’s eligible for depends on their ability to repay. Rural Development takes into account income, assets, debt, and payment assistance when weighing eligibility for USDA Direct home loans. No matter what the repayment ability is, you can’t borrow more than the local loan limit for the county where the home is located.

Are there other mortgage options with low down payment or no down payment in Iowa?

Yes, there may be other low down payment mortgage options, and no down payment mortgage options in Iowa besides USDA Direct Loans. You can begin by researching Iowa USDA Guaranteed Loans, Iowa FHA Loans, and Iowa VA Loans if you’re a veteran in IA or qualified family member. You may also want to look into helpful programs for down payment assistance in Iowa.

Iowa USDA Direct Loan Maximum Income Limits

1 Person
2 Person
3 Person
4 Person
5 Person
Adair County, IA $55,500$55,500 $55,500$55,500 $73,250
Adams County, IA $55,500$55,500 $55,500$55,500 $73,250
Allamakee County, IA $55,500$55,500 $55,500$55,500 $73,250
Ames, IA MSA $70,150$70,150 $70,150$70,150 $92,600
Appanoose County, IA $55,500$55,500 $55,500$55,500 $73,250
Audubon County, IA $55,500$55,500 $55,500$55,500 $73,250
Benton County, IA HUD Metro FMR Area $66,150$66,150 $66,150$66,150 $87,300
Boone County, IA $59,700$59,700 $59,700$59,700 $78,800
Bremer County, IA HUD Metro FMR Area $68,800$68,800 $68,800$68,800 $90,800
Buchanan County, IA $61,300$61,300 $61,300$61,300 $80,900
Buena Vista County, IA $55,500$55,500 $55,500$55,500 $73,250
Butler County, IA $56,100$56,100 $56,100$56,100 $74,050
Calhoun County, IA $55,500$55,500 $55,500$55,500 $73,250
Carroll County, IA $60,000$60,000 $60,000$60,000 $79,200
Cass County, IA $55,500$55,500 $55,500$55,500 $73,250
Cedar County, IA $61,600$61,600 $61,600$61,600 $81,300
Cedar Rapids, IA HUD Metro FMR Area $71,450$71,450 $71,450$71,450 $94,300
Cerro Gordo County, IA $55,500$55,500 $55,500$55,500 $73,250
Cherokee County, IA $56,400$56,400 $56,400$56,400 $74,450
Chickasaw County, IA $55,500$55,500 $55,500$55,500 $73,250
Clarke County, IA $55,500$55,500 $55,500$55,500 $73,250
Clay County, IA $55,500$55,500 $55,500$55,500 $73,250
Clayton County, IA $55,500$55,500 $55,500$55,500 $73,250
Clinton County, IA $55,500$55,500 $55,500$55,500 $73,250
Crawford County, IA $55,500$55,500 $55,500$55,500 $73,250
Davenport-Moline-Rock Island, IA-IL MSA $58,150$58,150 $58,150$58,150 $76,750
Davis County, IA $55,500$55,500 $55,500$55,500 $73,250
Decatur County, IA $55,500$55,500 $55,500$55,500 $73,250
Delaware County, IA $60,700$60,700 $60,700$60,700 $80,100
Des Moines County, IA $55,500$55,500 $55,500$55,500 $73,250
Des Moines-West Des Moines, IA MSA $70,000$70,000 $70,000$70,000 $92,400
Dickinson County, IA $63,200$63,200 $63,200$63,200 $83,400
Dubuque, IA MSA $65,100$65,100 $65,100$65,100 $85,950
Emmet County, IA $55,500$55,500 $55,500$55,500 $73,250
Fayette County, IA $55,500$55,500 $55,500$55,500 $73,250
Floyd County, IA $55,500$55,500 $55,500$55,500 $73,250
Franklin County, IA $55,500$55,500 $55,500$55,500 $73,250
Fremont County, IA $55,500$55,500 $55,500$55,500 $73,250
Greene County, IA $55,500$55,500 $55,500$55,500 $73,250
Grundy County, IA SEA $59,600$59,600 $59,600$59,600 $78,650
Hamilton County, IA $55,500$55,500 $55,500$55,500 $73,250
Hancock County, IA $56,150$56,150 $56,150$56,150 $74,100
Hardin County, IA $58,300$58,300 $58,300$58,300 $76,950
Henry County, IA $55,500$55,500 $55,500$55,500 $73,250
Howard County, IA $55,500$55,500 $55,500$55,500 $73,250
Humboldt County, IA $55,500$55,500 $55,500$55,500 $73,250
Ida County, IA $55,500$55,500 $55,500$55,500 $73,250
Iowa City, IA HUD Metro FMR Area $75,500$75,500 $75,500$75,500 $99,650
Iowa County, IA $60,400$60,400 $60,400$60,400 $79,750
Jackson County, IA $55,500$55,500 $55,500$55,500 $73,250
Jasper County, IA $58,100$58,100 $58,100$58,100 $76,700
Jefferson County, IA $55,500$55,500 $55,500$55,500 $73,250
Jones County, IA HUD Metro FMR Area $58,900$58,900 $58,900$58,900 $77,750
Keokuk County, IA $55,500$55,500 $55,500$55,500 $73,250
Kossuth County, IA $56,700$56,700 $56,700$56,700 $74,850
Lee County, IA $55,500$55,500 $55,500$55,500 $73,250
Louisa County, IA $55,500$55,500 $55,500$55,500 $73,250
Lucas County, IA $55,500$55,500 $55,500$55,500 $73,250
Lyon County, IA $59,100$59,100 $59,100$59,100 $78,000
Mahaska County, IA $55,500$55,500 $55,500$55,500 $73,250
Marion County, IA $60,300$60,300 $60,300$60,300 $79,600
Marshall County, IA $55,500$55,500 $55,500$55,500 $73,250
Mitchell County, IA $55,750$55,750 $55,750$55,750 $73,600
Monona County, IA $55,500$55,500 $55,500$55,500 $73,250
Monroe County, IA $55,500$55,500 $55,500$55,500 $73,250
Montgomery County, IA $55,500$55,500 $55,500$55,500 $73,250
Muscatine County, IA $56,650$56,650 $56,650$56,650 $74,800
O'Brien County, IA $57,200$57,200 $57,200$57,200 $75,500
Omaha-Council Bluffs, NE-IA HUD Metro FMR Area $68,800$68,800 $68,800$68,800 $90,800
Osceola County, IA $55,500$55,500 $55,500$55,500 $73,250
Page County, IA $55,500$55,500 $55,500$55,500 $73,250
Palo Alto County, IA $55,500$55,500 $55,500$55,500 $73,250
Plymouth County, IA HUD Metro FMR Area $60,950$60,950 $60,950$60,950 $80,450
Pocahontas County, IA $55,500$55,500 $55,500$55,500 $73,250
Poweshiek County, IA $57,050$57,050 $57,050$57,050 $75,300
Ringgold County, IA $55,500$55,500 $55,500$55,500 $73,250
Sac County, IA $55,500$55,500 $55,500$55,500 $73,250
Shelby County, IA $57,450$57,450 $57,450$57,450 $75,850
Sioux City, IA-NE-SD HUD Metro FMR Area $55,600$55,600 $55,600$55,600 $73,400
Sioux County, IA $61,600$61,600 $61,600$61,600 $81,300
Tama County, IA $55,500$55,500 $55,500$55,500 $73,250
Taylor County, IA $55,500$55,500 $55,500$55,500 $73,250
Union County, IA $55,500$55,500 $55,500$55,500 $73,250
Van Buren County, IA $55,500$55,500 $55,500$55,500 $73,250
Wapello County, IA $55,500$55,500 $55,500$55,500 $73,250
Washington County, IA HUD Metro FMR Area $60,150$60,150 $60,150$60,150 $79,400
Waterloo-Cedar Falls, IA HUD Metro FMR Area $59,600$59,600 $59,600$59,600 $78,650
Wayne County, IA $55,500$55,500 $55,500$55,500 $73,250
Webster County, IA $55,500$55,500 $55,500$55,500 $73,250
Winnebago County, IA $55,500$55,500 $55,500$55,500 $73,250
Winneshiek County, IA $60,900$60,900 $60,900$60,900 $80,400
Worth County, IA $55,500$55,500 $55,500$55,500 $73,250
Wright County, IA $55,500$55,500 $55,500$55,500 $73,250

More USDA Loan Resources

USDA Direct Loan Income Limits (Low Income)
USDA Direct Loan Limits (Low Income)

All USDA Loan Limits
All USDA Loan Income Limits
USDA Loan Requirements
USDA Loan Programs
USDA Loan Calculator

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Maximum Applicant Income
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