Quick Guide to Kentucky USDA Rural Development Loans Approval Requirements

Not every community qualifies—but if it does, it’s the best thing since sliced bread!

Check your listings to see if the property location qualifies. http://eligibility.sc.egov.usda.gov. Generous household income limits also apply, and you can check them out at this link as well.

Generate phone calls by letting everyone know 100% financing is still available for eligible properties and borrowers.

Add an additional note to the listing info and mention it in your ads.

Buyer Qualifications Highlights

• No down payment required, and zero move-in cost is possible.

• 30-year fixed rate loan.

• 6% seller contribution limit allowed.

• Lender closing cost contribution by premium pricing allowed. Does not count against 6% seller limit.

• 100% Loan up to appraisal allowed plus you can add the 1.00% Guarantee Fee on top of that.

• Low .35% Annual Fee included in monthly payment.

• Finance closing costs & prepaids if appraisal Is higher than sales contract.

• No stated maximum loan amount; maximum loan based on repayment ability.

• No cash contribution required from borrower.

• No pre-payment penalty

• Liberal income limits (by county)

• Gift funds and grants allowed.

• No cash reserve requirements.

Property Qualification Highlights

• Existing Home

• New Construction

• Manufactured Homes, new or existing. Since May 5, 2025, existing (used) manufactured homes are eligible in all 50 states, Kentucky included. The unit has to be manufactured within 20 years of the loan closing date, sit on a permanent foundation, have never been installed at another homesite, be at least 400 square feet, carry both the HUD certification label and the HUD data plate, and have no alterations made after it left the factory other than an engineered porch or deck. New units off a dealer lot are still eligible too.

• Modular Homes

• Town Homes. An attached townhome that is not part of a condominium regime does not need any project approval.

• Condos. The project can be approved by FHA, VA, Fannie Mae or Freddie Mac, or it can instead be shown to meet one of those agencies’ standards rather than already sitting on an approved list.

Prohibited Loan Purposes

• Co-signors not residing in the household

• Furniture and personal property

• Income-producing property unless minimal income-producing activity.

• Previously occupied manufactured homes are no longer prohibited. That restriction and the old 22-state pilot ended May 5, 2025, and existing manufactured homes meeting the property rules above are now eligible nationwide.