Kentucky Housing Corporation (KHC) Programs:
Updated July 31, 2026KHC offers below-market 30-year mortgage options (MRB or Secondary Market) paired with state down payment assistance issued through KHC-approved lenders. Key official resources: KHC Down Payment Assistance, the KHC partner tools/program grid, and the KHC lender directory. Always apply through a KHC-approved lender listed on KHC's site.
Kentucky First-Time Homebuyer Mortgage Programs:
Eligibility: First-time buyers (no ownership in the last 3 years) or buyers in targeted areas; household income must meet county/program charts listed in KHC partner resources.
Offerings: 30-year fixed mortgages (MRB/Secondary Market) that pair with FHA, VA, USDA, or conventional first mortgages and KHC subordinate DPA.
Requirements:
- Income limits: county- and program-specific (see KHC county income charts and program grids). KHC partner resources and AllRegs list current cap values and county charts.
- Purchase-price caps: KHC MRB and Secondary Market purchase-price limits are set by program and county. (Example KHC partner notices list a common MRB/Secondary Market cap near $566,354; confirm exact county limits with your lender and KHC AllRegs.)
- Minimum credit score (typical): around 620 for many government products (FHA/VA/USDA) and commonly around 660 for conventional KHC-eligible loans — see KHC partner grids for exact loan-type rules.
- Debt-to-income: lender- and product-dependent; KHC partner grids show common back-end DTI targets near 45% with AUS allowances sometimes near 50% with compensating factors.
- Homebuyer education: required for many local DPA streams and some KHC-assisted products (HUD-approved counseling accepted).
Down Payment Assistance (DPA) Options (statewide):
KHC Regular DAP (state program): KHC operates a Regular DAP that provides subordinate assistance to KHC first mortgages. KHC's DPA page lists assistance up to $12,500 (in $100 increments) delivered as a secondary loan repayable over a 15-year term. Apply through a KHC-approved lender. See KHC details: KHC DPA details and partner materials in the KHC tools area.
Kentucky Heroes & targeted benefits:
KHC and local partners commonly offer enhanced DPA or fee/rate incentives for teachers, first responders, veterans, healthcare workers, and other public servants. Amounts and availability change by program cycle and lender partner — contact participating lenders listed on KHC's lender directory for current offers: Find a KHC-Approved Lender.
Local Programs (examples and where to verify):
City and county programs are funded locally and open or close based on appropriations — verify availability with the administering agency before writing an offer.
Louisville / Jefferson County
Louisville Metro Down Payment Assistance: Louisville's official program provides DPA for low-to-moderate income buyers. The city has recently limited DPA to a specified LTV cap and maximum award amounts (city materials reference a cap of up to 15% LTV with a maximum assistance amount near $25,000). Confirm current availability, stacking rules, and HUD-approved counseling requirements on the Metro Office of Housing site: louisvilleky.gov — Down Payment Assistance.
Delta Home (Healthy Start): The Delta Home stream, funded in partnership with Delta Dental of Kentucky, is a targeted forgivable DPA stream for Healthy Start families; city materials list awards up to about $25,000 for qualifying families. See the city page for program windows and eligibility: Delta Home.
Lexington / Fayette County
REACH (REACH HOME): REACH operates Lexington-area HOME-funded homebuyer assistance and requires homebuyer education. Public REACH guidance shows second-mortgage assistance examples capped by household size (not to exceed $20,000 for 1-person households; $25,000 for 2-person households; $30,000 for 3+). Contact REACH for current application windows: reachky.org — REACH HOME.
Northern Kentucky (Boone / Kenton / Campbell)
Northern Kentucky HOME Consortium: HOME-funded homebuyer assistance administered through consortium cities typically offers 0% deferred/forgivable second mortgages for qualifying buyers. The Northern Kentucky HOME Consortium guidelines (administered through Covington for the PY2025–26 guidelines) describe zero-interest deferred second loans that are forgiven on a pro-rata basis after a 10-year occupancy schedule. See the official consortium guidelines: NKY HOME Consortium — Homebuyer Assistance Guidelines (Covington).
Additional federal options:
- USDA Rural Development: 0% down financing is available for eligible rural properties under the SFH Guaranteed program — property-level eligibility and income caps apply. See USDA RD fact sheet: USDA SFH Guaranteed fact sheet.
- VA Loans: Eligible veterans and active-duty buyers can access zero-down VA financing through VA-approved lenders.
- FHA Loans: Minimum down payment is typically 3.5% for applicants with credit scores around 580 or higher (lender overlays may apply). Confirm loan limits and FHA policy on HUD’s site: HUD FHA info & loan limits.
For stacking and buyability: KHC DAP normally requires a KHC first mortgage and must be originated by an approved lender. Local trust funds and HOME dollars can sometimes stack with KHC DAP; stacking rules, recapture, and forgiveness schedules are program-specific — verify with each administrator before relying on layered funds. Find lenders and full program matrices at kyhousing.org.
Program details, income limits, interest rates, and availability may change. Work with a KHC-approved lender early to confirm eligibility, exact limits, and current funding windows.
Seeking Agents® connects buyers with Kentucky agents familiar with KHC and local DPA stacks — free for buyers and sellers.