Why use USDA financing for your next home purchase in Kentucky?
There are very few ways to purchase a home these days in Kentucky without a typical 3.5% down payment that is required for an FHA loans in Kentucky. Many home buyers in Kentucky are surprised to find that a USDA Home Loan offers a lower payment than an FHA loan, even with NO DOWN PAYMENT! “How can this be?” you ask. The reason is because a Kentucky USDA home loan requires much lower MORTGAGE INSURANCE.
Kentucky FHA Loan vs. Kentucky USDA Loan Comparison
| FHA | USDA |
| $150,000 purchase price | $150,000 purchase price |
| 4.75% 30 year fixed rate | 4.75% fixed rate |
| 1.75% up front mortgage insurance (financed) | 1.0% Guarantee Fee (financed) |
| .85% month mi premium | .35% monthly mi premium |
| $871.19 P&I monthly payment with monthly mortgage insurance (not including taxes and insurance) |
$826.86 P&I monthly payment (not including taxes and insurance |
| $5250.00 required down payment | $0 down payment |
A rural housing USDA loan saved this client $46.74 per month and they made NO DOWN PAYMENT!
Other benefits of Kentucky USDA Home Loans
- Low up front closing costs
- In some cases closing costs can be financed if home appraises for more than purchase price
- Minor credit problems OK with a minimum credit score of 581***Most lenders will want a 620 or 640 score or higher.
- No maximum loan amounts just household income limits based on which Kentucky County you are buying a home.
- Fixed Rates Only for 30 years with no prepay penalty
A Kentucky USDA rural housing loan strive to find anyway possible to approve your loan, however there are some cases where a USDA Loan is not an option;
a previous bankruptcy must be discharged 3 years,
you must occupy the home being purchased as your primary residence,
the home may not be used for income producing purposes (farm, rental, etc.),
Senior Loan Officer
Kentucky USDA Mortgage Lender for Rural Housing Loans 