The Section 502 Direct Loan Program, also known as USDA Direct Loans, is a program that aids low and very-low-income individuals purchase decent healthy, safe and clean housing in eligible rural areas. That’s accomplished though offering payment assistance which boosts a borrower’s capacity to repay. This payment assistance can be described as a form of subsidy that lowers the mortgage repayment for a brief period, and the amount of assistance is contingent upon the adjusted family income. USDA Section 502 Direct Loans in Kentucky aren’t the same thing as USDA Section 502 Guaranteed Loans in Kentucky. The USDA Guaranteed Loan Program is more popular and accommodates a wider range of applicant incomes.

Can I get a USDA Direct Loan in Kentucky?

USDA Loan RequirementsUSDA Direct Loans in Kentucky are low income loans that can be used to purchase homes in rural areas. To qualify for Direct Loans, applicants must have low or very low income, which is defined by the USDA as 50% to 80% of the Area Median Income (AMI). Like other rural housing loan programs, USDA Direct Loans are a mortgage with no down payment. The median income for the entire state of KY is $50,589, although that figure may vary from county to county. The maximum yearly income limits for Kentucky USDA Direct Loan approval are listed below. Other than meeting Kentucky USDA Direct Loan income limits, applicants must adhere to the following criteria to be eligible:

  • You have no decent clean, safe, and sanitary housing presently.
  • You can’t be able to get a mortgage from another source with terms and conditions that could reasonably expected to be met.
  • You must use this property for your primary residence.
  • You must possess the legal capacity to be able to contract a loan
  • You must meet citizenship or eligible noncitizen requirements.
  • You can’t be barred or suspended from participation in federal programs.

Additionally, the subject property must meet the following conditions:

  • Be a modestly sized home for that area.
  • Market value can’t be in excess of the areas applicable loan limit.
  • Can’t be designed for the production of income.

What areas in KY are eligible for USDA Direct Loans?

The property in question must be in an approved rural area. USDA Rural Development provides a webpage where you can search specific addresses in KY here.

How much can I borrow with a USDA Direct Home Loan?

The size of the mortgage that an applicant’s eligible for depends on their ability to repay. Rural Development takes into account income, assets, debt, and payment assistance when weighing eligibility for USDA Direct home loans. No matter what the repayment ability is, you can’t borrow more than the local loan limit for the county where the home is located.

Are there other mortgage options with low down payment or no down payment in Kentucky?

Yes, there may be other low down payment mortgage options, and no down payment mortgage options in Kentucky besides USDA Direct Loans. You can begin by researching Kentucky USDA Guaranteed Loans, Kentucky FHA Loans, and Kentucky VA Loans if you’re a veteran in KY or qualified family member. You may also want to look into helpful programs for down payment assistance in Kentucky.

Kentucky USDA Direct Loan Maximum Income Limits

1 Person
2 Person
3 Person
4 Person
5 Person
Adair County, KY $40,950$40,950 $40,950$40,950 $54,050
Allen County, KY HUD Metro FMR Area $44,900$44,900 $44,900$44,900 $59,250
Anderson County, KY $55,500$55,500 $55,500$55,500 $73,250
Ballard County, KY $48,250$48,250 $48,250$48,250 $63,700
Barren County, KY $42,100$42,100 $42,100$42,100 $55,550
Bath County, KY $40,950$40,950 $40,950$40,950 $54,050
Bell County, KY $40,950$40,950 $40,950$40,950 $54,050
Bowling Green, KY HUD Metro FMR Area $49,600$49,600 $49,600$49,600 $65,450
Boyle County, KY $45,200$45,200 $45,200$45,200 $59,650
Breathitt County, KY $40,950$40,950 $40,950$40,950 $54,050
Breckinridge County, KY $47,600$47,600 $47,600$47,600 $62,850
Butler County, KY HUD Metro FMR Area $40,950$40,950 $40,950$40,950 $54,050
Caldwell County, KY $43,750$43,750 $43,750$43,750 $57,750
Calloway County, KY $47,450$47,450 $47,450$47,450 $62,650
Carlisle County, KY $44,300$44,300 $44,300$44,300 $58,500
Carroll County, KY $45,600$45,600 $45,600$45,600 $60,200
Carter County, KY $40,950$40,950 $40,950$40,950 $54,050
Casey County, KY $40,950$40,950 $40,950$40,950 $54,050
Cincinnati, OH-KY-IN HUD Metro FMR Area $65,050$65,050 $65,050$65,050 $85,850
Clarksville, TN-KY MSA $48,700$48,700 $48,700$48,700 $64,300
Clay County, KY $40,950$40,950 $40,950$40,950 $54,050
Clinton County, KY $40,950$40,950 $40,950$40,950 $54,050
Crittenden County, KY $44,650$44,650 $44,650$44,650 $58,950
Cumberland County, KY $40,950$40,950 $40,950$40,950 $54,050
Elizabethtown, KY HUD Metro FMR Area $54,100$54,100 $54,100$54,100 $71,400
Elliott County, KY $40,950$40,950 $40,950$40,950 $54,050
Estill County, KY $40,950$40,950 $40,950$40,950 $54,050
Evansville, IN-KY MSA $53,750$53,750 $53,750$53,750 $70,950
Fleming County, KY $40,950$40,950 $40,950$40,950 $54,050
Floyd County, KY $40,950$40,950 $40,950$40,950 $54,050
Franklin County, KY $54,550$54,550 $54,550$54,550 $72,000
Fulton County, KY $40,950$40,950 $40,950$40,950 $54,050
Garrard County, KY $47,750$47,750 $47,750$47,750 $63,050
Grant County, KY HUD Metro FMR Area $44,550$44,550 $44,550$44,550 $58,800
Graves County, KY $44,900$44,900 $44,900$44,900 $59,250
Grayson County, KY $40,950$40,950 $40,950$40,950 $54,050
Green County, KY $41,350$41,350 $41,350$41,350 $54,600
Harlan County, KY $40,950$40,950 $40,950$40,950 $54,050
Harrison County, KY $44,950$44,950 $44,950$44,950 $59,350
Hart County, KY $40,950$40,950 $40,950$40,950 $54,050
Hickman County, KY $44,700$44,700 $44,700$44,700 $59,000
Hopkins County, KY $47,350$47,350 $47,350$47,350 $62,500
Huntington-Ashland, WV-KY-OH HUD Metro FMR Area $45,100$45,100 $45,100$45,100 $59,550
Jackson County, KY $40,950$40,950 $40,950$40,950 $54,050
Johnson County, KY $40,950$40,950 $40,950$40,950 $54,050
Knott County, KY $40,950$40,950 $40,950$40,950 $54,050
Knox County, KY $40,950$40,950 $40,950$40,950 $54,050
Laurel County, KY $40,950$40,950 $40,950$40,950 $54,050
Lawrence County, KY $40,950$40,950 $40,950$40,950 $54,050
Lee County, KY $40,950$40,950 $40,950$40,950 $54,050
Leslie County, KY $40,950$40,950 $40,950$40,950 $54,050
Letcher County, KY $40,950$40,950 $40,950$40,950 $54,050
Lewis County, KY $40,950$40,950 $40,950$40,950 $54,050
Lexington-Fayette, KY MSA $59,600$59,600 $59,600$59,600 $78,650
Lincoln County, KY $40,950$40,950 $40,950$40,950 $54,050
Livingston County, KY $45,300$45,300 $45,300$45,300 $59,800
Logan County, KY $44,150$44,150 $44,150$44,150 $58,300
Louisville, KY-IN HUD Metro FMR Area $61,100$61,100 $61,100$61,100 $80,650
Lyon County, KY $50,950$50,950 $50,950$50,950 $67,250
Madison County, KY $52,700$52,700 $52,700$52,700 $69,550
Magoffin County, KY $40,950$40,950 $40,950$40,950 $54,050
Marion County, KY $41,600$41,600 $41,600$41,600 $54,900
Marshall County, KY $49,050$49,050 $49,050$49,050 $64,750
Martin County, KY $40,950$40,950 $40,950$40,950 $54,050
Mason County, KY $42,800$42,800 $42,800$42,800 $56,500
McCracken County, KY $48,650$48,650 $48,650$48,650 $64,200
McCreary County, KY $40,950$40,950 $40,950$40,950 $54,050
Meade County, KY HUD Metro FMR Area $48,950$48,950 $48,950$48,950 $64,600
Menifee County, KY $40,950$40,950 $40,950$40,950 $54,050
Mercer County, KY $50,550$50,550 $50,550$50,550 $66,750
Metcalfe County, KY $40,950$40,950 $40,950$40,950 $54,050
Monroe County, KY $40,950$40,950 $40,950$40,950 $54,050
Montgomery County, KY $41,500$41,500 $41,500$41,500 $54,800
Morgan County, KY $40,950$40,950 $40,950$40,950 $54,050
Muhlenberg County, KY $44,650$44,650 $44,650$44,650 $58,950
Nelson County, KY $52,900$52,900 $52,900$52,900 $69,850
Nicholas County, KY $41,600$41,600 $41,600$41,600 $54,900
Ohio County, KY $40,950$40,950 $40,950$40,950 $54,050
Owen County, KY $49,900$49,900 $49,900$49,900 $65,850
Owensboro, KY MSA $54,800$54,800 $54,800$54,800 $72,350
Owsley County, KY $40,950$40,950 $40,950$40,950 $54,050
Perry County, KY $40,950$40,950 $40,950$40,950 $54,050
Pike County, KY $40,950$40,950 $40,950$40,950 $54,050
Powell County, KY $41,350$41,350 $41,350$41,350 $54,600
Pulaski County, KY $40,950$40,950 $40,950$40,950 $54,050
Robertson County, KY $41,500$41,500 $41,500$41,500 $54,800
Rockcastle County, KY $40,950$40,950 $40,950$40,950 $54,050
Rowan County, KY $42,700$42,700 $42,700$42,700 $56,350
Russell County, KY $40,950$40,950 $40,950$40,950 $54,050
Shelby County, KY HUD Metro FMR Area $60,950$60,950 $60,950$60,950 $80,450
Simpson County, KY $44,800$44,800 $44,800$44,800 $59,150
Spencer County, KY SEA $61,100$61,100 $61,100$61,100 $80,650
Taylor County, KY $40,950$40,950 $40,950$40,950 $54,050
Todd County, KY $43,300$43,300 $43,300$43,300 $57,150
Union County, KY $44,650$44,650 $44,650$44,650 $58,950
Washington County, KY $45,100$45,100 $45,100$45,100 $59,550
Wayne County, KY $40,950$40,950 $40,950$40,950 $54,050
Webster County, KY $51,050$51,050 $51,050$51,050 $67,400
Whitley County, KY $40,950$40,950 $40,950$40,950 $54,050
Wolfe County, KY $40,950$40,950 $40,950$40,950 $54,050

More USDA Loan Resources

USDA Direct Loan Income Limits (Low Income)
USDA Direct Loan Limits (Low Income)

All USDA Loan Limits
All USDA Loan Income Limits
USDA Loan Requirements
USDA Loan Programs
USDA Loan Calculator

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