Homebuyers in suburban areas who would have missed their shot at a zero-down home loan will get a do-over. USDA home loan eligibility map changes will not take effect in 2014 like most experts thought.

The map changes were to happen (the first time) on 10/1/13. Then they were pushed back to October 1,2014, and now have been moved again to 10/1/15. If you are looking to buy a home in one of the affected areas, you still have a chance to qualify for a zero-down loan.

Why delayed map changes are a big deal

The USDA Rural Development loan is designed to encourage people to buy homes in rural areas. As such, the terms are quite favorable, including a zero down payment, low interest, and cheaper mortgage insurance fees.

The catch is that these benefits only apply to loans on properties located in USDA-eligible areas. These areas, believe it or not, are still based on populations that the 2000 census determined.

Suburban areas and smaller towns alike have grown since then. Areas have changed so much in fact that “rural” towns back then could very well be vibrant, up-and-coming suburban communities now.

Hence, the new maps will reflect such changes, and reclassify eligibility areas. Lucky for some homebuyers, there is another year to take advantage of the USDA loan option before the new maps go into effect.

Which home buyers will benefit?

Naturally, if you’re looking to buy a home in the center of a big city like New York or San Francisco, this news won’t affect you. However, it’s worth looking at the old and new eligibility maps to see if the neighborhoods in which you are looking are affected. Even areas that seem too over-developed to be classified as “rural” might not have been as such in the year 2000.

For instance, if you’re looking around Dallas, Texas, Seattle, WA, or even Raleigh, NC, there’s a good shot that you could qualify for a USDA loan, but only if you act before October of 2015.

The USDA website also lists some counties in Delaware and Maryland that are currently eligible, but will likely be affected; the same goes for Van Buren, Alaska, and some Oregon cities that have outgrown the rural label. In fact, approximately 90 percent of the affected areas are currently located in or around Metropolitan areas, according to RuralHome.org.

In all, it’s estimated that 500 USDA eligible areas are up for reclassification next year because of population growth alone. There are other factors that can change eligibility as well, although there isn’t one official national definition of what it means to be rural or “rural in character.” For the purposes of home loans, here is how the Department of Agriculture defines a “rural” area:

• It has a population of less than 2,500.
• It has a population of between 2,500 and 10,000 but is “rural in character”.
• It has a population of between 10,000 and 20,000 but is outside a metro area or has limited availability of mortgage credit.

In other words, the classification is somewhat open to interpretation beyond just population figures, which is why it pays to research the old and future maps, and then work with a mortgage provider who is knowledgeable about USDA eligibility.

When all is said and done, the new rural zones will result in the removal of about 10,000 square miles from the eligibility map, which will potentially affect about 8 percent of (or 9 million) eligible home buyers. If you think you may be one of them, take advantage of the extra time you’ve been granted, and start doing your USDA home loan research.

What to consider when getting a USDA loan

If you are considering a property in a designated rural area, keep in mind that you still have to meet other qualifications in order to be a USDA loan candidate. For starters, your household income cannot exceed 115 percent of the median household income in the property’s area (that is, if you want to qualify for the USDA Guaranteed loan program). Your credit score should also be fair (around 640 or higher), and you can’t have too many assets in your name.

If you think you fit the bill, contact a USDA-approved lender to help you get started before the year is out.