I specialize in Kentucky USDA Rural Housing mortgage loans in KY. Apply for free today for a Rural Housing loan Pre-Approval Letter. Same day approvals. I offer the USDA Rural Development Guaranteed Housing Loans for all counties in Kentucky that are eligible. Put my expert advice to use. Call or text 502-905-3708 or email kentuckyloan@gmail.com This website is not affiliated with USDA or any other government agency. NMLS# 57916 NMLS# 1738461
Kentucky USDA Rural Development Mortgage Guidelines
2026 Kentucky USDA Rural Housing Loan Guide
The USDA Rural Development mortgage program continues to be one of the strongest zero-down options for eligible Kentucky homebuyers. This updated 2026 guide provides a fast, clear overview of USDA credit rules, income limits, eligible areas, and how to get approved quickly.
Why Kentucky Homebuyers Choose USDA Loans
- Zero down payment with no statewide loan limits
- Low monthly mortgage insurance (0.35%)
- 1.0% upfront guarantee fee (can be financed)
- 30-year fixed rate only
- Flexible credit requirements
- Not limited to first-time homebuyers
- Closing costs may be financed up to the appraised value
- Seller-paid costs allowed if written into the offer
Compare USDA to other Kentucky loan programs:
2026 USDA Credit & Income Guidelines (Kentucky)
- Preferred credit score: 640+ for automated approval
- Manual underwriting possible down to 580 with strong documentation
- DTI target: 29% housing / 41% total
- Two tradelines reporting for 12 months required
- Borrowers with access to 20% down are ineligible and qualify for conventional financing cannot use the USDA program
Check Kentucky income limits here: USDA Income Limits by County.
Full USDA program details: Kentucky USDA Loan Resource Hub.
2026 USDA Property Eligibility (Kentucky)
Most Kentucky rural and semi-rural areas remain eligible. The following remain ineligible due to population density:
- Jefferson County (Louisville)
- Fayette County (Lexington)
- Northern Kentucky (Covington, Florence, Erlanger, etc.)
- Bowling Green
- Owensboro
- Hopkinsville
- Paducah
- Richmond
- Frankfort
Check any Kentucky address using the official USDA tool: USDA Property Eligibility Map .
USDA Appraisal, Well, and Septic Requirements
- Private well → water test required
- Septic → may require inspection if flagged by appraisal
- Homes older than 100 years → may need additional inspections
USDA After Bankruptcy, Foreclosure, or Short Sale
- Short sale: 3 years with re-established credit
- Foreclosure included in bankruptcy → 3 years from discharge
Get Pre-Approved for a Kentucky USDA Loan
With more than 200 USDA loans originated across Kentucky, I provide fast, accurate USDA pre-approvals with hands-on guidance through closing.
Kentucky USDA Rural Housing Loans Available Again
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Complete your application in minutes using the link below.
Click or call today with your Kentucky USDA Mortgage Questions? 502-905-3708 call or text
Joel Lobb, Mortgage Broker FHA, VA, KHC, USDA
NMLS 57916 | Company NMLS 1738461
Call/Text 502-905-3708
Email: kentuckyloan@gmail.com
Kentucky USDA Rural Housing Loan Shutdown 2025 | What Homebuyers Need to know (updated)
USDA SFH Guaranteed Loan Program Fully Reopens — New PITI Guidelines & What Kentucky Homebuyers Need to Know (November 2025)
The USDA Single-Family Housing Guaranteed Loan Program (SFHGLP) is officially back to normal operations following the end of the federal government shutdown. Funding is available, Conditional Commitments are being issued, and lenders can now move USDA files forward again. However, USDA has also implemented a major guideline change that impacts borrower eligibility.
USDA Is Fully Operational Again
Important: Loans must not close before receiving Form RD 3555-18, Conditional Commitment. A GUS recommendation (“Accept,” “Refer,” etc.) is not the same as a Conditional Commitment. Closing without the Commitment will disqualify the file from an LNG.
New USDA Ratio Guideline: PITI Reduced to 29%
USDA previously announced the permanent reduction of the maximum PITI ratio from 34% down to 29%, effective November 4, 2025. This change impacts eligibility for many borrowers in Kentucky—especially first-time buyers and households with tighter debt-to-income ratios.
Which Borrowers Get 29% vs. 34%?
- Applications submitted in GUS before November 4 (Final Submission)
These will continue to follow the prior guideline allowing up to 34% PITI. - Applications submitted in GUS on or after November 4
These must follow the new 29% PITI rule.
USDA will update the official handbook (HB-1-3555, Chapter 11, Ratio Analysis) soon to reflect this policy revision.
Conditional Commitments Are Being Issued — But Delays Are Likely
USDA is actively issuing Conditional Commitments; however, the Agency is processing requests strictly in the order received. Due to the backlog, files may take longer than typical to be reviewed. Lenders, agents, and borrowers should prepare for extended turn times during this transition period.
Recommendation: Build extra time into contract deadlines for USDA loans over the next few weeks.
Lenders Asked to Review and Clean Up Their USDA Pipeline
To help manage workload and reduce backlog, USDA is asking lenders to withdraw any files that no longer need to be processed. This includes applications where borrower circumstances have changed, contracts fell through, or the borrower has moved to another loan product.
How to Withdraw a File in GUS
- Status: Unknown or Preliminary
You can withdraw the application directly in GUS. - Status: Final Submission but still Pending
Recall the Final Submission → then withdraw. - Status: In Process or Approved
Contact your USDA Origination & Processing Division (OPD) to remove the request and release funds.
See HB-1-3555, Chapter 14.5 for full guidance.
What This Means for Kentucky Homebuyers and Realtors
This update carries real, on-the-ground implications for buyers and contracts in the Kentucky market:
- Some buyers who were previously eligible may no longer qualify under the reduced 29% PITI ratio.
- Loans locked into the old 34% rule (submitted pre-Nov 4) are still protected.
- Turn times will likely be slower as USDA clears backlog.
- Do not close any USDA loan until the lender has the official Conditional Commitment in hand.
I will continue monitoring USDA turn times and guideline updates to keep all borrowers and partners informed.
Copy-and-Paste Messaging for Buyers & Realtors
For Realtors:
“USDA has reopened and is issuing commitments again. The max PITI ratio permanently changed from 34% to 29% as of November 4, so some buyers may see eligibility changes. USDA is processing a backlog, so allow extra time on USDA deals and make sure the Conditional Commitment is received before closing.”
For Buyers:
“USDA is back up and running. Your loan is still moving forward. Because the Agency is catching up from the shutdown, there may be slight delays, but funding is available. I’ll keep you updated as your file moves toward full approval and the Conditional Commitment.”
Need Help with USDA Eligibility in Kentucky?
If you are a homebuyer or realtor looking to confirm if a property qualifies for a USDA loan in Kentucky, you can use the official eligibility map:
➡️ Check USDA Property Eligibility Here
Or contact me directly for a full income, credit, and property eligibility review.
About the Author
Joel Lobb, Mortgage Broker FHA, VA, KHC, USDA
, Mortgage Broker – FHA, VA, USDA, KHC, Fannie Mae
NMLS #57916 | Company NMLS #1738461
Call/Text: 502-905-3708
Email: kentuckyloan@gmail.com
Website: www.mylouisvillekentuckymortgage.com
Equal Housing Lender. This is not a commitment to lend. All loans subject to credit approval.
Kentucky USDA Rural Housing Eligibility Map
Kentucky USDA Rural Housing Eligibility Map – Check Your Property Address
If you're searching for a zero-down home loan option in Kentucky, the USDA Rural Housing Loan offers a powerful path to homeownership for eligible buyers. The first step is confirming whether a property is located in an eligible USDA-approved area. Use the official Kentucky USDA Eligibility Map below to check any address instantly.
How to Check If a Kentucky Property Is USDA Eligible
- Visit the Kentucky USDA Eligibility Map and enter the property address.
- Explore your desired location in Kentucky or manually enter the street address.
- Determine if the property falls inside a USDA Rural Housing eligible zone.
Kentucky USDA Property Eligibility Map – Enter Address Below:
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More USDA & First-Time Homebuyer Resources in Kentucky
Joel Lobb, Mortgage Broker • NMLS #57916 • Company NMLS #1738461 • Equal Housing Lender.
This is not a commitment to lend. All loans subject to credit, income, and property approval.