Compare USDA, FHA, VA, Conventional & KHC Loan Programs

Kentucky Mortgage Loan Comparison

Compare USDA, FHA, VA, Conventional & KHC Loan Programs

Complete Loan Program Comparison

Feature USDA Rural FHA VA Conventional KHC
Down Payment 0% 3.5% 0% 3-20% 0%
Mortgage Insurance 0.35% Annual 0.85% Annual None 0.20-2.25% Varies
Upfront Fee 1.0% 1.75% 2.15-3.3% None None
Credit Score Min 580 and above with compensating factors 580 No minimum 620 620
Income Limits Yes, by county None None None Yes
Property Location Rural areas only Anywhere Anywhere Anywhere Kentucky only
First-Time Buyer Not required Not required Not required Not required Usually required
Seller Concessions Up to 6% Up to 6% Up to 4% 3-9% Up to 6%
Max DTI Ratio 45% 57% 41% 45% 45%
Occupancy Primary only Primary only Primary only All types Primary only

Down Payment Assistance Options

Program Down Payment Required Additional Assistance Closing Cost Help Income Restrictions
USDA Rural $0 100% financing Can be financed/seller paid Yes, moderate income
KHC + DPA 3% (can be assisted) Up to $10,000 DPA Closing cost assistance Yes, income limits
VA Loan $0 100% financing Limited seller concessions None
FHA 3.5% minimum Gift funds allowed Seller concessions up to 6% None
Conventional 3-20% Various first-time programs Limited seller concessions Usually none

Quick Reference Guide

USDA Rural

Best for: Rural Kentucky buyers with moderate income
  • Down Payment: $0
  • Credit Score: 580+
  • Location: Rural only
  • Income Limits: Yes
  • MI Rate: 0.35%

FHA

Best for: First-time buyers with lower credit
  • Down Payment: 3.5%
  • Credit Score: 580+
  • Location: Anywhere
  • Income Limits: None
  • MI Rate: 0.85%

VA

Best for: Military veterans and active duty
  • Down Payment: $0
  • Credit Score: No min
  • Location: Anywhere
  • Income Limits: None
  • MI Rate: None

Conventional

Best for: Strong credit and stable income
  • Down Payment: 3-20%
  • Credit Score: 620+
  • Location: Anywhere
  • Income Limits: None
  • MI Rate: Varies

KHC

Best for: Kentucky first-time buyers
  • Down Payment: 0%
  • Credit Score: 620+
  • Location: Kentucky
  • Income Limits: Yes
  • DPA Available: Up to $10K

Special Scenarios Comparison

Scenario USDA FHA VA Conventional KHC
After Bankruptcy 3 years from discharge 2 years from discharge 2 years from discharge 4 years from discharge 3 years from discharge
After Foreclosure 3 years 3 years 2 years 7 years 3 years
After Short Sale 3 years 3 years 2 years 4 years 3 years
Refinancing Streamline available Streamline available IRRRL available Standard refi Limited options
Gift Funds Not allowed for down payment Allowed Allowed Allowed Allowed

Important Notes for Kentucky Homebuyers:

  • USDA Eligibility: Property must be in eligible rural areas. Major metro areas like Louisville, Lexington, and Northern Kentucky are excluded.
  • Income Verification: USDA and KHC programs have strict income limits that vary by county and household size.
  • Two-Step Process: USDA loans require approval from both the lender and USDA office, adding 4-6 days to closing.
  • Closing Costs: USDA allows closing costs to be financed or paid by seller (up to 6% seller concessions).
  • Property Requirements: USDA may require well/septic inspections and has concerns about homes over 100 years old. USDA appraisal reports must meet HUD minimum requirements so FHA
  • Down Payment Assistance: KHC programs can be combined with FHA or conventional loans for additional assistance.
  • Credit Considerations: Lower credit scores may require compensating factors like verified rent history and reserves.

Joel Lobb 
Senior  Loan Officer
Text/call 502-905-3708

kentuckyloan@gmail.com

Joel Lobb, Mortgage Broker FHA, VA, KHC, USDA

Why Work With Me? Local Expertise: I know the ins and outs of Kentucky’s housing market and loan programs. Fast Approvals: I offer free mortgage applications with same-day approvals to keep the process moving quickly. Customized Loan Solutions: Whether you’re buying a home or refinancing, I’ll find the right loan program to fit your needs. Personalized Service: I treat every client like family, ensuring you’re supported and informed throughout the process. About My Website Visit my website for a wealth of resources tailored to Kentucky homebuyers. You’ll find: Step-by-step guides for first-time homebuyers. Information on loan programs like FHA, VA, USDA, and KHC. Tools to help you calculate potential payments and affordability. Blog posts with tips and updates on the Kentucky housing market. A secure portal to start your loan application and upload documents. Please Note: My website is not endorsed by the FHA, VA, USDA, or any government agency. It is an independent platform created to educate and assist homebuyers with expert advice and accessible tools.

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