Iowa USDA Loans 2026
No down payment across most of rural Iowa — the eligible areas, the FY2026 income limits, and the fees that replace a down payment.
USDA eligible areas in Iowa
USDA’s Single Family Housing Guaranteed Loan Program is built for rural areas, and Iowa is overwhelmingly rural by USDA’s definition. Of the state’s 99 counties, the large majority fall outside any metropolitan statistical area entirely.
What is not eligible is easier to describe than what is. The built-up cores of Des Moines and West Des Moines, Cedar Rapids, Davenport, Sioux City, Waterloo, Iowa City, Dubuque, Ames and Council Bluffs are generally excluded, while smaller communities and the countryside around those cities usually qualify. Eligibility is set by address, not by county — two homes a few miles apart can get different answers.
Check the specific property before you make an offer. USDA publishes an address-level map at the USDA property eligibility site. A neighbouring town qualifying tells you nothing about the house you want.
Iowa USDA income limits
USDA caps household income at a moderate-income threshold that varies by area. Most of Iowa sits at the national base figure, with ten areas set higher.
| Area | 1–4 person household | 5–8 person household |
|---|---|---|
| Most Iowa counties (base) | $122,800 | $162,100 |
| Ames area (Story County) | $142,450 | $188,050 |
| Iowa City area (Johnson County) | $139,600 | $184,300 |
| Des Moines–West Des Moines area | $133,850 | $176,700 |
| Council Bluffs area (Omaha metro) | $131,100 | $173,100 |
| Benton County | $130,100 | $171,750 |
| Boone County | $129,150 | $170,500 |
| Dickinson County | $126,650 | $167,200 |
| Sioux County | $126,300 | $166,750 |
| Bremer County | $124,550 | $164,450 |
Income is measured across the whole household, not just the borrowers, and USDA adds 8% of the four-person limit for each person beyond eight. Figures are FY2026 and are published by USDA Rural Development.
USDA loan requirements
- No down payment. USDA finances up to 100% of the appraised value.
- The property must be in an eligible rural area and be your primary residence.
- Household income must fall within the applicable limit above.
- USDA publishes no program minimum credit score. 640 is USDA’s automated-underwriting cutoff; lower scores need manual review.
In place of mortgage insurance, USDA charges two fees: an upfront guarantee fee of 1% of the loan amount, usually financed into the loan, and an annual fee of 0.35% collected monthly. Both are well below FHA’s equivalent, which is why USDA is often the cheapest option for an Iowa buyer who qualifies.
How to apply
- Check the property address on USDA’s eligibility map before making an offer.
- Total your whole household’s income and compare it against the limit for that county.
- Find a lender approved for the Guaranteed program — not every Iowa lender participates.
- Expect a slightly longer timeline than FHA or conventional, since the file goes to USDA for a conditional commitment after the lender approves it.
