USDA manual underwriting: when GUS says refer.

What sends a USDA file to manual

A credit score below 640, limited credit, a higher debt ratio, or signs of credit problems can all cause a refer. Some situations require manual review on their own. See automated vs manual underwriting.

The ratio rules

On a manual file, the housing payment can be up to 29% of income and total debt up to 41%. A debt ratio waiver can raise those to 32% housing and 44% total, but only if every applicant has a validated credit score of 680 or higher and the file has an acceptable compensating factor. A GUS Accept can allow higher ratios.

A note on history: USDA raised the housing limit to 34% in August 2024 as a temporary exception, then returned to 29% for applications after November 4, 2025. Some websites still show the old number.

That means a borrower with a score in the 500s or low 600s has to fit within 29% and 41%. Low score files work when debts are low.

Compensating factors

Things like a long, stable employment history or a minimal increase from your current housing payment can support a waiver. One surprise: USDA doesn't accept cash on hand alone as a compensating factor.

Credit review

The underwriter does a full review of your credit history, focusing on the last 12 months. Late payments, collections and judgments need written explanations. If you don't have a credit score, USDA can use nontraditional credit like rent and utilities.

Lender minimums

USDA sets no minimum score, but lenders do, and many won't manually underwrite USDA at all. I work with lenders who consider manual USDA files down to 580, and lower in some cases. See lender overlays.

A 590 score with low debt

Darius had a 590 score from a rough stretch two years earlier, steady income and only a small car payment.

GUS returned a refer. A manual underwriter reviewed his explanations and 12 months of clean rent history. His ratios fit within 29% and 41%, and he closed with no down payment.