What are the qualifications for a Rural Housing Loan in Kentucky?

Kentucky USDA Guaranteed Rural Housing Loans Qualifying Criteria

This program offers Kentucky home buyers that meet income and credit requirements to buy a home with zero down payment and get a 30-year fixed-rate loan.

What are the Kentucky USDA Loan Eligibility Requirements

Basic qualifications for a Kentucky USDA Home Loan include:
  • The property being purchased must be in a rural area of Kentucky as defined by the USDA.
  • The property must be owner-occupied. Investment or vacation properties are not eligible for USDA loans.
  • You must meet the income restrictions for the county the property is located in. Each county has a maximum income limit defined by the USDA. This maximum income limit depends on the cost of living, median income and other economic characteristics of the county the property is located in.
  • Credit score requirements set by USDA are as follows below:
  • 581 minimum middle credit score for all borrowers on the loan – purchase
  • No score allowed with alternative tradelines
  • Most Kentucky USDA lenders will want a 620 or 640 score or higher. A 640 middle score is required for a USDA loan through GUS, the automated underwriting system used by rural development to determine the max lending limits for a loan. 
  • No foreclosure, short sale, or Chapter 7 bankruptcy discharge within three years of contract ratification date on credit report not permitted
  • Minimum of two tradelines on credit, with a positive payment history within the most recent 12-month period. Accounts can be open or closed
  • If two tradelines aren’t on credit, alternative tradelines can be
  • No mortgage delinquency in the last 12 months for a USDA-to-USDA Refinance
  • Income limits for rural housing areas of Kentucky center around $86,000 for a household family of four and up to $115 for a household family of five or more. Northern Kentucky Counties of Boone, Kenton, Campbell, Pendelton, Bracken, can make up to $93,000 for a household family of four and up to $123,000 for a household family of five or more. 
  • No used manufactured homes. Only new mobile homes that meet FHA standards. 
  • No working farms or income-producing farmland with the property. 
  • All loans must be fully documented per Agency Guidelines. USDA likes to see a 2-year job history with stable employment. Does not have to be the same employer, just a contiguous 2-year work history with no gaps over 30 days. 
  • If recently graduated from college, sometimes they will waive the 2-year job history rule if show transcripts and be on your job for 6-12 months. Case by case here. 
  • For Self Employed borrowers, in addition to Agency Guidelines, two years of the tax returns (personal and business) along with a year-to-date profit and loss (unaudited)
  • If overtime or bonus income or second job is used to qualify, you can take a 2-year avg and as long as stable and not decreasing, you can usually this income to qualify. 
  • They usually will take your base gross income to qualify you on the mortgage loan. They don't qualify you off your net income.

Benefits of a Kentucky USDA Loan

USDA loans offer a number of unique benefits that set them apart from standard home loans. USDA loans require no down payment, so qualified individuals can finance up to 100% of the home’s total purchase price. This makes them one of the more desirable loans available to homeowners.
The United States Department of Agriculture (USDA) created a loan program that allows borrowers to purchase a home with a zero percent down payment. More commonly, this mortgage product is known as the USDA loan program or Rural Development Guaranteed Housing Loan Program. USDA loans are issued through the USDA loan program and has helped over thousands of families buy and upgrade their homes in rural suburban areas.
Kentucky USDA Loan Property Eligibility Map

Kentucky USDA Loan Property Eligibility

enter address below:


Joel Lobb
Mortgage Loan Officer
Individual NMLS ID #57916

American Mortgage Solutions, Inc.

Text/call:      502-905-3708
fax:            502-327-9119