4 Things Every Borrower Needs to Know to Get Approved for a Mortgage Loa...

Ultimate Guide for Kentucky First-Time Homebuyers: Steps, Loan Programs & How to Apply

 

Introduction: How to Buy Your First Home in Kentucky

Are you a first-time homebuyer in Kentucky looking to purchase your dream home? Buying a house is one of the biggest financial decisions you'll ever make. Understanding the steps involved can help you feel confident throughout the process.

• In this guide, we'll cover:

•  How much house you can afford
•  Loan programs for first-time homebuyers in Kentucky
•  Credit score requirements
•  Down payment & closing costs
•  Mortgage pre-approval process
•  Required documents & how to apply

By the end of this article, you'll have a clear roadway to homeownership in Kentucky!

Step 1: Determine How Much House You Can Afford

One of the first steps to buying a home is understanding your budget. Mortgage lenders suggest you should consider a price range. It is recommended not to buy a home that exceeds 30% to 45% of your gross monthly income. For instance, if you earn $3000 gross a month, your maximum house payment should be about $1350 a month. This includes PITI.

Use a mortgage calculator to estimate your monthly payment, including property taxes, homeowners insurance, and mortgage insurance.

- Kentucky Mortgage Calculator

Kentucky Mortgage Calculator

Home Price ($): Down Payment ($): Interest Rate (%): Loan Term (years): Annual Property Taxes ($): Annual Homeowners Insurance ($): PMI Rate (%): Monthly HOA Fees ($):

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Step 2: Check Your Credit Score

Your credit score plays a crucial role in determining your mortgage eligibility and interest rate. The mortgage scores used by lenders are different than the ones usually seen for borrowers. Be aware of this.

Here’s how you can improve your score before applying

Step 2: Check Your Credit Score

Your credit score plays a crucial role in determining your mortgage eligibility and interest rate. Here’s how you can improve your score before applying:

✔️ Pay down credit card balances
✔️ Make all payments on time
✔️ Avoid applying for new credit cards or loans
✔️ Don’t make big purchases before getting approved
✔️ If possible, avoid changing jobs before closing on your home

Pull your own credit report from www.annualcreditreport.com to see what is on your credit report from Experian, Equifax, and Transunion. You will not be able to get your mortgage fico scores but you can see what creditors are reporting before you apply to correct any errors

The credit scores used by mortgage lenders are different than what the consumers see, so be aware of that.

We can pull your fico mortgage scores for free, no costs to you, as far as the application process. If you want to obtain your own mortgage fico scores

While the FICO^® 8 model is the most widely used scoring model for general lending decisions, banks use the following FICO scores when you apply for a mortgage:

• FICO^® Score 2 (Experian)
• FICO^® Score 5 (Equifax)
• FICO^® Score 4 (TransUnion)

FICO Scores used for mortgages

Credit Score Requirements for Kentucky First-Time Homebuyers

Step 3: Save for a Down Payment & Closing Costs

How Much Do You Need for a Down Payment?

💰 FHA Loan: 3.5% of the purchase price
💰 Conventional Loan: 3-20% (Varies)
💰 VA & USDA Loans and KHC Down payment Assistance Loans : No down payment required

Other Expenses to Consider

1. Earnest Money Deposit: Shows sellers you’re serious. This is known as a good faith deposit. Typically, it's $500 at the minimum. However, more serious buyers show a bigger commitment by putting down $1000 or more.
2. Closing Costs: Typically 2-5% of the loan amount
3. Home Inspection Costs: $300-$500
4. Appraisal Costs: $550 to $700 range

Step 4: Get Pre-Approved for a Mortgage in Kentucky

🔹 What is Mortgage Pre-Approval?

Being pre-approved means a lender has reviewed your financial information and determined how much you can borrow. This makes you a stronger buyer in the eyes of sellers.

✅ To Get Pre-Approved, You’ll Need the following documents plus more:

• W2’s from the past 2 years for 2023 and 2024
• Last months of pay stubs
• Bank statements (Last 2 months)
• 2 years of tax returns and all schedules
• Divorce decree (if applicable)
• Additional income documents for other income possible
• Looking for stability in the income. Waited over the last two years and the next 3 years.
• Two forms of ID> Driver's License and card

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Step 5: Choose the Right Mortgage Loan in Kentucky

Types of Mortgage Loans Available

Loan Type	Who Qualifies?	Down Payment	Upfront Mortgage Insurance	Monthly Mortgage Insurance	Min. Credit Score
VA Loan	Veterans & eligible service members	None	None	None	580
USDA Loan	Rural homebuyers	None	2% of loan amount (can roll in)	Required	640
FHA Loan	Buyers meeting income/credit limits	3.5%	1.75% of loan amount	Required	580-640
203K Loan	Buyers renovating a home	3.5%	1.75% of loan amount	Required	580-640
Conventional 97	First-time homebuyers	3%	None	Required	620
Select Smart Plus	Buyers meeting lender’s requirements	3-20%	None	Required	620

Step 6: Submit Your Mortgage Application

• Once you’ve chosen the right loan and been pre-approved, you’ll submit a formal mortgage application with your lender.

• The Lender Will Verify:
  ✅ Your credit score and credit bureau-Three scores are pulled from Experian, Equifax and Experian
  ✅ Income & employment history for last two years
  ✅ Bank statements for last two months & tax returns for last two years
  ✅ Property appraisal
• Title search

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Step 7: Close on Your New Home! 🎉

Your loan is approved. All final paperwork is completed. You’ll attend the closing meeting to sign documents and get the keys to your new home!

🏡 Congratulations! You’re now a Kentucky homeowner!

Ready to Buy a Home in Kentucky? Get Expert Help Today!

Buying your first home is a big step, but you don’t have to do it alone. Work with a trusted mortgage broker like Joel Lobb to get expert guidance, personalized loan options, and fast approvals.

📩 Contact Joel Lobb Today for a Free Consultation!

📞 Call or Text: (502) 905-3708
📧 Email: kentuckyloan@gmail.com

🔹 Get Pre-Approved Now & Start House Hunting!

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Final Thoughts

If you're a first-time homebuyer in Kentucky, understanding the steps involved is crucial. Being aware of the loan programs available will help you make a smart financial decision.

1 -  Email - kentuckyloan@gmail.com 2.   Call/Text - 502-905-3708

Joel Lobb
Mortgage Loan Officer - Expert on Kentucky Mortgage Loans

 Website: www.mylouisvillekentuckymortgage.com
 Address: 911 Barret Ave., Louisville, KY 40204

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Evo Mortgage
Company NMLS# 1738461
Personal NMLS# 57916

For assistance with Kentucky mortgage loans, reach out via email, call, or text Joel Lobb directly.

Kentucky Local Home Loan Lender Services

 First-Time Home Buyers Welcome
 FHA, Rural Housing (USDA), VA, and Kentucky Housing Corporation (KHC) Loans
 Conventional Loan Options Available
 Fast Local Decision-Making
 Experienced Guidance Through the Home Buying Process

 

Grants for First Time Home Buyers in Kentucky

$20,000 Grant Money Available for Kentucky Home Buyers – First-Time Home Buyers Assistance!

Are you a first-time home buyer in Kentucky looking for financial assistance? The Federal Home Loan Bank has created a special fund to help low-to-moderate income families achieve homeownership. This $20,000 grant is designed to assist home buyers with down payments and closing costs, making it easier to secure a home without the burden of large upfront expenses.

Grant Money for First-Time Home Buyers in Kentucky

The Federal Home Loan Bank grant is an excellent opportunity for Kentucky home buyers who meet income requirements. If you're struggling with saving for a down payment or need extra funds for closing costs, this program can help. Funds are limited and will be available starting March 3rd until they are reserved.

Household Income Limits Per County

To qualify for this home buyer grant, your household income must fall within the limits set for your county. Below are the income eligibility requirements for households with 1-2 persons and 3+ persons:

County	1-2 Person(s) Income Limit	3+ Persons Income Limit
Nelson	$73,284	$84,277
Washington	$73,796	$84,866
Larue	$74,596	$85,786
Hardin	$74,596	$85,786
Bullitt	$77,120	$88,688
Marion	$68,544	$79,968
Jefferson	$77,120	$88,688
Anderson	$73,076	$84,038
Franklin	$73,588	$84,626
Woodford	$76,160	$87,584
Mercer	$73,684	$84,737

Other counties may be available for eligibility.

Who Can Apply for This Home Buyer Grant?

This program is designed for low-to-moderate income households who need financial assistance to purchase a home. It is ideal for first-time home buyers in Kentucky looking for an affordable way to buy a home without high out-of-pocket costs.

Benefits of This Grant for Kentucky Home Buyers

• Receive $20,000 in grant money for down payment and closing costs.
• Helps first-time home buyers afford a home sooner.
• Makes homeownership more accessible for low-to-moderate income families.
• Available in multiple counties across Kentucky.

How to Apply for the Kentucky Home Buyer Grant

Funds for this program will be available starting March 3rd and will be distributed on a first-come, first-served basis. If you're interested in applying, it's essential to get pre-qualified as soon as possible.

For more information on qualifying for this first-time home buyer grant in Kentucky, or to start your application, contact Joel Lobb, Senior Loan Officer at American Mortgage Solutions, Inc.

📞 Call/Text: (502) 905-3708
📧 Email: kentuckyloan@gmail.com
🌐 Website: MyLouisvilleKentuckyMortgage.com

Act Fast – Funds Are Limited!

If you're a first-time home buyer in Kentucky, this $20,000 grant could be the key to owning your dream home. Don't wait until funds run out—start your home buying journey today!

Down Payment Assistance Kentucky 2025 Kentucky Housing Corporation KHC $10,000

Unlock Your Dream Home: Kentucky Down Payment Assistance Loans for 2025 – $10,000 Grants Available

Are you a Kentuckian dreaming of homeownership but struggling to save for a down payment? You’re not alone. According to the National Association of Realtors, nearly 60% of renters cite saving for a down payment as their biggest barrier to buying a home. Fortunately, Kentucky offers life-changing down payment assistance (DPA) programs to help bridge the gap—and in 2025, eligible buyers could qualify for **up to $10,000 in forgivable grants or low-interest loans** to make homeownership a reality. 

In this guide, we’ll break down everything you need to know about Kentucky’s 2025 down payment assistance programs, including eligibility criteria, application steps, and insider tips to maximize your savings. Let’s dive in! 

Why Kentucky Down Payment Assistance Matters in 2025

The median home price in Kentucky hovers around $225,000, meaning a traditional 20% down payment would require $45,000 upfront—a daunting figure for many families. However, with federal and state-backed DPA programs, qualified buyers can purchase a home with as little as **0–3% down**. For 2025, Kentucky is doubling down on its commitment to affordable housing by expanding access to grants, forgivable loans, and low-interest options. 

The star of the show? A **$10,000 down payment assistance grant** designed to help first-time buyers, veterans, educators, and low-to-moderate-income households. Let’s explore how this program works. 

How to Apply for Kentucky Down Payment Assistance in 2025

Follow these steps to secure your $10,000 grant: 

1. Check Your Eligibility

Use the KHC’s online eligibility calculator or consult a HUD-approved housing counselor. 

2. Get Pre-Approved for a Mortgage

Partner with a KHC-approved lender who understands DPA programs. 

Frequently Asked Questions

Q: Do I have to repay the $10,000 assistance?
A: Yes over 10 years at 3.75% rate works out to be around $100 a month added to your 1st mortgage payment

Q: Can I combine multiple DPA programs?
A: Sometimes! For example, you might pair the $10,000 grant with a Mortgage Credit Certificate (MCC) for tax savings. 

Q: Are there grants for home repairs?
A: No. KHC loan cannot be used for repairs to the house. It can only be used to meet the minimum down payment requirements and pay for your closing costs and prepaids if any monies are left over after you meet the minimum down payment requirements for FHA, VA, USDA and Conventional mortgage loans

1 -  Email - kentuckyloan@gmail.com 

2.   Call/Text - 502-905-3708

Joel Lobb
Mortgage Loan Officer - Expert on Kentucky Mortgage Loans

 Website: www.mylouisvillekentuckymortgage.com
 Address: 911 Barret Ave., Louisville, KY 40204

---

Evo Mortgage
Company NMLS# 1738461
Personal NMLS# 57916

For assistance with Kentucky mortgage loans, reach out via email, call, or text Joel Lobb directly.

Kentucky Local Home Loan Lender Services

 First-Time Home Buyers Welcome
 FHA, Rural Housing (USDA), VA, and Kentucky Housing Corporation (KHC) Loans
 Conventional Loan Options Available
 Fast Local Decision-Making
 Experienced Guidance Through the Home Buying Process

Medical Debt Collections being Removed from Credit Reports

Medical Collections on Credit Report

The Consumer Financial Protection Bureau (CFPB) finalized a rule January 7, 2025 that will remove $49 billion in medical debt from credit reports, helping 15 million Americans! 

Here’s what’s changed: 

• Medical bills are no longer on credit reports – They won’t hurt your score anymore. 
• Lenders can’t use medical info in loan decisions. 
• Credit scores could rise – Many people will see a boost of points
•  More mortgage approvals

1 -  Email - kentuckyloan@gmail.com 

2.   Call/Text - 502-905-3708

Joel Lobb
Mortgage Loan Officer - Expert on Kentucky Mortgage Loans

 Website: www.mylouisvillekentuckymortgage.com
 Address: 911 Barret Ave., Louisville, KY 40204

---

Evo Mortgage
Company NMLS# 1738461
Personal NMLS# 57916

For assistance with Kentucky mortgage loans, reach out via email, call, or text Joel Lobb directly.

Kentucky Local Home Loan Lender Services

 First-Time Home Buyers Welcome
 FHA, Rural Housing (USDA), VA, and Kentucky Housing Corporation (KHC) Loans
 Conventional Loan Options Available
 Fast Local Decision-Making
 Experienced Guidance Through the Home Buying Process

Kentucky Housing Income Limits for Mortgage Loans

New Income Limits for KHC Loans in Kentucky

New Income and Purchase Price Limits for Secondary Market and Mortgage Revenue Bond KHC’s eliminated the front-end ratio of 40%, effective with new reservations on Monday, June 24, 2024.

Eligibility: Both first-time and repeat home buyers purchasing a single-family dwelling. Purchase price can be no more than $510,939.

 Applicant’s income must be within applicable secondary market limits in effect.

• Federal Housing Administration (FHA)

• Minimum 620 credit score.
• Financing to 96.50% of lesser of sales price or appraised value.
• Maximum ratio 50%.
• Upfront and Annual Mortgage Insurance Premiums 30-Year Loan Term LTV less than or equal to 95% 1.75% UFMIP .50 Annual LTV greater than 95% 1.75% UFMIP .55 Annual

Rural Housing Services (RHS)

• Minimum 620 credit score.
• Financing to 100% of the appraised value, plus guarantee fee of 1.00%/0.35% annual fee.
• Maximum ratio 50%

• Veteran’s Administration (VA)

Minimum 620 credit score.
•Financing to 100% of the lesser of the appraised value or sale price plus funding fee.
•Maximum ratio 50%.
•No monthly mortgage insurance.

Regular Down Payment Assistance Programs (DAP) 

Only home buyers obtaining a Kentucky Housing Corporation first mortgage are eligible for DAP funds. 

Interest Rate with DAP applicable. 

•  Up to $10,000 Minimum of $1,000 
• Terms 3.75% amortized over 10 years Purchase Price Limit $510,939

With AUS approval, can go up to 50% with all loans.

 Required Repairs Buyer or seller must use OWN funds to pay for repairs

1 -  Email - kentuckyloan@gmail.com 

2.   Call/Text - 502-905-3708

Joel Lobb
Mortgage Loan Officer - Expert on Kentucky Mortgage Loans

 Website: www.mylouisvillekentuckymortgage.com
 Address: 911 Barret Ave., Louisville, KY 40204

---

Evo Mortgage
Company NMLS# 1738461
Personal NMLS# 57916

Equal Housing Lender

 (www.nmlsconsumeraccess.org).

For assistance with Kentucky mortgage loans, reach out via email, call, or text Joel Lobb directly.

The view and opinions stated on this website belong solely to the authors, and are intended for informational purposes only. The posted information does not guarantee approval, nor does it comprise full underwriting guidelines. This does not represent being part of a government agency. The views expressed on this post are mine and do not necessarily reflect the view of my employer. Not all products or services mentioned on this site may fit all people.
 (www.nmlsconsumeraccess.org).

The Credit Report and Credit Scores Used For A Kentucky Mortgage Loan Approval FHA, USDA, Fannie Mae and VA

Understanding Credit Scores for Kentucky Mortgage Loan Approval

Why do some mortgage lenders require a certain credit score whereas other mortgage lenders may not?

One Word Mortgage Overlays. Some lenders will institute a higher credit score than the minimum below to lessen their risk of having to buy the loan back from the government agencies if they get too many mortgage defaults. In order to protect their lending portfolio and hedging their risk, they will require say a 640 credit score or higher for a FHA loan, whereas the guidelines clearly state you can do a FHA loan with a minimum credit score of 580 To understand mortgage overlays, it helps to have a foundation of how the mortgage approval process works. Mortgage lenders always have underwriting guidelines—standards to determine the amount and terms you qualify for.

Credit Score Minimum guidelines are typically set based on the mortgage program, e.g., FHA, VA, or USDA. FHA, --

What score does the Mortgage Lender Use? Why may it be different than the one you are seeing?

The reason mortgage lenders use older FICO Scores is because they don’t have a choice. They are essentially forced to use them.

For a bank to sell a mortgage to Fannie Mae or Freddie Mac, FHA VA, USDA, Etc, the loan has to meet certain guidelines. Some of these guidelines require borrowers to have a minimum credit score under specific FICO Score generations.

If you’re planning to apply for a mortgage, be aware that the credit score you see on your application might differ slightly from the one you’re used to.

It might even be different than what comes up when you monitor your credit, or even when you apply for a car loan.

Banks use a slightly different credit score model when evaluating mortgage applicants. Below, we go over what you need to know about credit scores you’re looking to buy a home.

The scoring model used in mortgage applications

While the FICO® 8 model is the most widely used scoring model for general lending decisions, banks use the following FICO scores when you apply for a mortgage:

FICO® Score 2 (Experian)
FICO® Score 5 (Equifax)
FICO® Score 4 (TransUnion)

As you can see, each of the three main credit bureaus (Equifax, Experian and TransUnion) use a slightly different version of the industry-specific FICO Score. That’s because FICO tweaks and tailors its scoring model to best predict the creditworthiness for different industries and bureaus. You’re still evaluated on the same core factors (payment history, credit use, credit mix and age of your accounts), but the categories are weighed a little bit differently.

The FICO 8 model is known for being more critical of high balances on revolving credit lines. Since revolving credit is less of a factor when it comes to mortgages, the FICO 2, 4 and 5 models, which put less emphasis on credit utilization, have proven to be reliable when evaluating good candidates for a mortgage.

Mortgage lenders pull all three reports, from all three bureaus, but they only use one when making their final decision.

“A bank will use all three bureaus,”--- “It’s called a tri-merge.”

If all three of your scores are the same, then their choice is simple. But what if your scores are different?

And if you are applying for a mortgage with another person, such as your spouse or partner, each applicant’s FICO 2, 4 and 5 scores are pulled. The bank identifies the median score for both parties, then uses the lowest of the final two.

Contact Joel Lobb for Expert Mortgage Advice

Joel Lobb is an experienced Mortgage Loan Officer , Inc. specializing in helping Kentucky homebuyers navigate credit and mortgage processes.

Contact Information:

• Text/Call: 502-905-3708
• Email: kentuckyloan@gmail.com
• Website: www.mylouisvillekentuckymortgage.com

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Disclaimer: The information provided is for educational purposes and does not guarantee approval or represent underwriting guidelines. Always consult with your lender for personalized advice.

If you'd like any adjustments or additional details, let me know!

NMLS 57916  | 

The view and opinions stated on this website belong solely to the authors, and are intended for informational purposes only. The posted information does not guarantee approval, nor does it comprise full underwriting guidelines. This does not represent being part of a government agency. The views expressed on this post are mine and do not necessarily reflect the view of my employer. Not all products or services mentioned on this site may fit all people.
NMLS ID# 57916, (www.nmlsconsumeraccess.org).

 

Kentucky USDA Rural Housing Mortgage Lender: 11 Things Borrowers Don’t Know About USDA Loans in...

Kentucky USDA Rural Housing Mortgage Lender: 11 Things Borrowers Don’t Know About USDA Loans in...:  If you’re exploring home-ownership options in Kentucky, you will be surprised to learn about the unique benefits of USDA loans. Many refer ...