USDA Loans

USDA Rural Development Loans in North Texas

A USDA loan (or Rural Development Loan) is a government-backed mortgage that allows qualified buyers to purchase a home in an eligible rural area with a $0 down payment. Designed to support low- to moderate-income families, these loans offer some of the most competitive interest rates available and more flexible credit requirements than conventional mortgages.

How to Qualify for a USDA Loan in 2026

While First Lonestar Bank is based in Frisco, we specialize in helping families finance homes in the nearby USDA-eligible communities of North Texas. Qualification is based on two main factors: where the home is located and how much your household earns.

• Geographic Eligibility: The home must be in a USDA-defined rural area. In the North Texas region, this often includes parts of Celina, Gunter, Pilot Point, and Anna.
• Income Limits: Your total household income cannot exceed 115% of the median income for your specific area. For 2026, these limits have been updated—our team can help you calculate your "Adjusted Gross Income" to see if you fall within the guidelines.
• Credit Standards: We typically look for a credit score of 640 or higher for automated approval, though we can often help borrowers with unique profiles through manual underwriting.
• Primary Residence: The property must be your permanent home; USDA loans cannot be used for investment properties or vacation homes.

The Strategic Advantages of USDA Financing

For those willing to live just a few miles outside the major DFW suburban hubs, the USDA program offers benefits that are hard to beat:

1. True 100% Financing: This is one of the only zero-down programs available to non-veterans, allowing you to keep your savings for furniture and move-in costs.
2. Lower Monthly Costs: The mortgage insurance fees for USDA loans are generally lower than the monthly PMI on an FHA loan, which means a lower monthly payment for you.
3. Closing Cost Flexibility: You can often ask the seller to pay up to 6% of your closing costs, or in some cases, roll those costs into the loan if the home appraises for more than the purchase price.

The First Lonestar Difference

We know North Texas isn't just big cities and suburbs. As a local community bank, we understand the value of the growing rural communities surrounding Frisco. We bend over backward to help you navigate the USDA's specific appraisal and eligibility requirements, providing a human-to-human experience that big national lenders can't match.

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USDA Loan Frequently Asked Questions (FAQs)

Do I have to be a first-time homebuyer?

No! While many people think USDA loans are just for first-time buyers, anyone who does not currently own an "adequate" home in the area can apply for this program.

Can I use a USDA loan to buy a farm?

Not exactly. While the program is run by the Dept of Agriculture, it's intended for residential use. You can certainly buy a home with acreage, but it cannot be a commercially income-producing farm.

What if my income is slightly over the limit?

The USDA allows specific "Income Deductions." We can often subtract costs for childcare, medical expenses for elderly family members, or even costs for adult students living at home to help bring your qualifying income below the limit.

The Fine Print 

This is not a commitment to lend; you must submit additional information for review and approval. Rates, Annual Percentage Rates (APRs), and terms are subject to change without notice. Certain restrictions apply to all programs. See your FLB Mortgage Loan Officer for complete program guidelines, loan application, applicable fees and annual percentage rates (APRs) for all loan programs. Full underwritten approval is required, and all loan approvals are subject to credit, income, and asset reviews and approvals. Bank NMLS#1215182