USDA Rural Development mortgages for Kentucky Home buyers
The U.S. Department of Agriculture mortgage program is for Kentucky home buyers that have no money to put down, have a stable 2 year job history, no bankruptcies or foreclosures in last 3 years and the new house payment should be close to or not more than 1/3 of your gross monthly income, this is called effective income.
There is also a test for compliance income meaning cannot make more than a certain amount to use the USDA loan program in Kentucky. Most Kentucky counties are limited to $82k for a household of four, and up to $109k household income for a family of five or more.
Thy used an automated underwriting system called GUS to pre-approved Kentucky home Buyers. If your score, middle credit score of the three main bureaus of experian, equifax, and trans union is below 640, you will automatically get downgraded to a refer and it will make it more difficult to get approved for the USDA loan.
I would suggest to get your scores up to 640 before submitting your loan application, however a lot of lenders including myself will go down to a 620 score, but be ready to hand over your blood type and other documents. 😂😂
You don’t have to be a Kentucky first time home buyer people with low to moderate incomes who want to buy a home in an eligible area. They typically don’t want you to own another piece of real estate and if you have access to 20% down payment they will not let you use the program.
This program is not intended for working farms, so if the property has farm income, i.e. crops, cattle, livestock, or other income this will not work for USDA loan programs.
They will do loans on mobile homes that meet FHA standards and that are brand new. They will not finance a used mobile home.
To get a Kentucky USDA loan, you work with a bank or other lender. The loan is backed by the USDA. You must be within certain income requirements — which depend on your area — and agree to use the home solely as a primary residence.
Like Kentucky FHA loans , Kentucky Rural Development USDA mortgages have fees. There is an upfront guarantee fee, which can be as much as 1.0 percentile of the principal loan amount, which is added to your loan. You also will have to pay a mortgage insurance fee which is .35% and this is called the annual fee. This is way cheaper than mortgage insurance premiums of 1.75% and .85% for the same comparison.