In Utah, USDA Rural Development loans will calculate qualifying income two different ways for a potential homeowner.
The first type of income is your “Eligibility Income”. This calculation will include all types of income and is used to determine your ability to repay the USDA 
mortgage loan. USDA will calculate income for all mortgage applicants on the loan. USDA Rural Development income may include salary, hourly, bonus, overtime, child support, alimony and other consistent and continual income.
The second income that a USDA Mortgage will consider is referred to as “Adjusted Income”. This calculation is used to help determine if the income exceeds the maximum income limits for USDA. This adjusted income must not exceed 115% of the median household income for the area. USDA mortgages allow this income to be adjusted to help bring your income below the maximum income limits.
Allowable Deductions to Determine "Adjusted Income"
___
How can I determine if my income is adequate to repay the loan?
The amount of your proposed monthly payment (principal and interest), real estate taxes, insurance, and other credit debts cannot exceed 41% of you gross monthly income without an exception. You may receive an exception if you have compensating factors that would improve your ability or willingness to pay the mortgage.
How much money will I need for a down payment with a USDA mortgage?
A down payment is not required. USDA Rural Development loans require no down payment. This means you are able to receive 100% financing of the purchase price of the property.
Can I Qualify for a USDA rural mortgage before I find a house?
Yes, it is encouraged to get a pre-approval from a mortgage professional before you find a home. Once you find a home in an eligible area you will be able to close and fund the loan much quicker if you are pre-approved.
What is the maximum income I can make for USDA Rural Development loans?
USDA requires you to make no more then 125% of the median income for the area you are purchasing the home in You may deduct certain items to see if your “Adusted Income” is under the maximum income limits.
What about private mortgage insurance (PMI) with a USDA mortgage?
You are not required to pay private mortgage insurance (PMI). This is one of the reasons that a USDA Rural Development home loan is a great financing choice.
What Utah Counties are eligible for USDA Rural Housing Loans?
USDA Rural Housing will lend in most Utah counties. A Rural housing mortgage usually is unavailable in cities larger than 25,000 people.
You can check out a Utah Rural Developement map here.
If you have a specific address you want checked please click here.
Mike Harrison
Principal Lending Manager
Email: mike (at) firstfedmort.com
Qualify Now Online
First Federal Mortgage, Inc
Salt Lake City, Utah
801-404-3540 Cell
888-800-1629 Toll Free
[...] Calculating income can be tricky with an RDA Rural Development home mortgage loan. There are two different calculations you need to be aware of. The first is the “Eligibility Income” the second calculation is the “Adjusted Income”. Both play a factor in qualifying. [...]
[...] insurance, making this one of the most affordable loans in Utah. You will qualify if you have the ability to make monthly mortgage payments, show the willingness to pay the loan back, make less than 125% of the median income and live in a [...]