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Kentucky KHC Regular Down Payment Assistance Program

The Kentucky Housing Corporation (KHC) Regular Down Payment Assistance Program is designed to help eligible homebuyers in Kentucky reduce the upfront costs of purchasing a home. By offering affordable loans for down payment and closing cost assistance, the program ensures that more residents can achieve the dream of homeownership.

Benefits

  • Provides up to $10,000 in assistance to cover down payment and closing costs.
  • Offered as a 10-year loan with a low fixed interest rate, ensuring manageable monthly payments.
  • Works in conjunction with KHC's affordable mortgage options to provide comprehensive financial support for homebuyers.
  • Helps reduce the financial burden of upfront costs, making homeownership more accessible for first-time and eligible repeat buyers.

Eligibility Requirements

  • Applicants must meet income limits, which vary based on household size and the location of the property.
  • The property must be located in Kentucky and used as the buyer’s primary residence.
  • A minimum credit score of 640 is typically required, along with lender-specific underwriting criteria.
  • Debt-to-income ratios must meet program guidelines to ensure buyers can afford their mortgage payments.
  • Participants must complete a KHC-approved homebuyer education course to prepare for the responsibilities of homeownership.

Additional Information

The KHC Regular Down Payment Assistance Program is a critical resource for homebuyers seeking to reduce the upfront costs of purchasing a home. By providing low-interest loans for down payment and closing cost assistance, the program empowers eligible residents to achieve stability and invest in their future. Administered by the Kentucky Housing Corporation, this program supports sustainable housing solutions and strengthens communities throughout Kentucky.

Frequently Asked Questions About Our Program

What is the Kentucky Housing Corporation (KHC) Regular Down Payment Assistance Program?

The KHC Regular Down Payment Assistance Program (DAP) offers eligible homebuyers a loan of up to $10,000 to assist with down payment and closing costs. This loan is repayable over a 10-year term at a fixed interest rate of 3.75%.

Who is eligible for the KHC Regular DAP?

All homebuyers obtaining a KHC first mortgage are eligible for the Regular DAP, regardless of whether they are first-time or repeat homebuyers.

What is the maximum purchase price allowed under the Regular DAP?

The maximum purchase price for homes financed through the Regular DAP is $510,939.

Are there income limits for applicants of the Regular DAP?

Yes, applicants must meet income limits that vary based on the county and household size. These limits are established to ensure assistance is provided to those in need.

Is there a minimum credit score requirement for the Regular DAP?

Yes, applicants must meet specific credit underwriting standards set by KHC. While exact credit score requirements may vary, a minimum score is typically required.

Are there any restrictions on borrower assets for the Regular DAP?

No, there is no liquid asset review, and there are no limits on borrower reserves for the Regular DAP.

Can the Regular DAP be used in conjunction with other KHC programs?

Yes, the Regular DAP can be combined with other KHC loan programs to provide comprehensive assistance tailored to the homebuyer's needs.

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Is homebuyer education required to qualify for the Regular DAP?

Homebuyer education may be required, especially for first-time homebuyers, to ensure they are well-prepared for homeownership responsibilities.

How do I apply for the KHC Regular DAP?

To apply for the Regular DAP, you should contact a KHC-approved lender who will guide you through the application process and determine your eligibility.

What are the repayment terms for the Regular DAP loan?

The Regular DAP loan is repayable over a 10-year term with a fixed interest rate of 3.75%, resulting in consistent monthly payments.

Can the Regular DAP assist with both down payment and closing costs?

Yes, funds from the Regular DAP can be used to cover both down payment and eligible closing costs, reducing the upfront financial burden for homebuyers.

Are there any fees associated with the Regular DAP?

Standard loan fees, such as origination and processing fees, may apply. It's important to discuss all potential fees with your lender.

Is there a prepayment penalty for the Regular DAP loan?

No, there is no prepayment penalty. Borrowers can pay off their Regular DAP loan early without incurring additional fees.

Does the Regular DAP have specific property eligibility requirements?

Yes, the property must be the borrower's primary residence and meet KHC's property guidelines, including purchase price limits.

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Are manufactured homes eligible for financing under the Regular DAP?

Manufactured homes may be eligible if they meet KHC's property standards and are financed with a KHC first mortgage.

What happens if I sell my home before the Regular DAP loan is repaid?

If you sell your home before the Regular DAP loan is fully repaid, the remaining balance of the loan must be paid off at the time of sale.

Can I refinance my first mortgage and keep the Regular DAP loan?

Refinancing your first mortgage may require you to pay off the remaining balance of the Regular DAP loan. It's important to discuss this with your lender.

Are there debt-to-income ratio requirements for the Regular DAP?

Yes, applicants must meet debt-to-income ratio requirements set by KHC to ensure they can manage their mortgage and DAP loan payments.

Is the Regular DAP available statewide?

Yes, the Regular DAP is available to eligible homebuyers throughout the state of Kentucky.

How long does the application process take for the Regular DAP?

The application timeline can vary based on individual circumstances and the lender's process. It's advisable to start the application process early to ensure timely approval.

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