Saving for a down payment can feel like the last big hurdle between you and a home in Richmond. If that sounds familiar, you are not alone. The good news is Kentucky Housing Corporation offers down payment help that can make your first move or next move possible. In this guide, you will learn how KHC’s program works, what limits apply in Madison County, and the exact steps to use it with confidence. Let’s dive in.
KHC down payment help at a glance
KHC’s Down Payment Assistance is money you can use toward your down payment, closing costs, and prepaids. It comes as a subordinate loan that you repay over time and it must be paired with a KHC first mortgage. You cannot use the assistance without a KHC first mortgage in place. KHC’s program page outlines the basics.
KHC has posted temporary increases to the maximum assistance in recent years. One increase showed up to $12,500 with repayment over 15 years at 4.75 percent for loans reserved during the stated window. Because amounts, rates, and reservation deadlines can change, always confirm the current DAP amount, rate, term, and any cutoff dates with a KHC‑approved lender.
Madison County limits you must meet
To use KHC funds in Richmond, your purchase and income must be under county limits. For Madison County today:
- Secondary Market purchase price limit: $544,232
- Secondary Market gross applicant income limit: $154,700
You can verify the latest limits and see Mortgage Revenue Bond (MRB) income tiers for your household size on KHC’s Madison County information page. If your numbers are above the limit for your funding source, you may not qualify.
Loan types that pair with KHC
KHC assistance works with KHC first‑mortgage options that use FHA, VA, USDA, or conventional programs. The income and price limits you must meet follow the first‑mortgage program you use. Ask your lender which option fits your budget and goals.
Why KHC help matters in Richmond right now
Prices have risen in recent years, and the best listings still move quickly. A recent snapshot shows Richmond’s median sold price around $301,452 and Madison County around $285,450. These figures change month to month, but they set helpful expectations for your search (Richmond market snapshot, Madison County snapshot).
Here is a simple example. On a $300,000 purchase with 3.5 percent down, your minimum down payment is $10,500. A KHC DAP of $10,000 to $12,500 could cover most or all of that, plus some closing costs. You will repay the DAP each month according to its rate and term, so weigh the lower cash to close against the added second‑loan payment in your budget.
Step‑by‑step: How to use KHC in Richmond
Confirm the basics. Plan to occupy the home as your primary residence. Check your household income and target purchase price against Madison County’s current limits for your funding source on the KHC county page.
Contact a KHC‑approved lender. Tell them you want a KHC first mortgage with DAP. Ask about the current DAP amount, interest rate, repayment term, and whether funds are available for reservation.
Get pre‑approved. Your lender will match you with the best KHC first‑mortgage option, such as FHA, VA, USDA, or conventional. You cannot use DAP without a KHC first mortgage.
Gather documents. Be ready with pay stubs, W‑2s, tax transcripts, bank statements, ID, and employment details. Some buyers must complete homebuyer education; your lender will tell you if it applies and where to take it. You can review KHC guidance in the program materials referenced here.
Reserve your funds. KHC assistance is reserved for your loan. If there is a temporary increase, confirm you are inside the reservation window and that funds remain. Use the official KHC program page for current information and ask your lender to lock it in.
Go under contract and close. Your closing will include a KHC first mortgage and a KHC DAP second lien. Review the DAP note for repayment terms, monthly cost, and what happens if you refinance or sell.
After closing. Keep your closing documents. If you refinance later, ask whether the DAP must be paid off or if subordination is allowed under KHC policy.
Costs, repayment, and fine print to know
KHC DAP is a repayable second loan, often provided in $100 increments for eligible costs. When KHC posts a temporary increase, the repayment term and rate can differ from standard offerings. The recent example noted 15 years at 4.75 percent for loans reserved in the window. The exact amount, rate, and term that apply to you depend on your reservation date. Funding is limited and subject to change, so verify details on the KHC DAP page and with your lender.
If you plan to refinance, ask early about KHC subordination rules and any restrictions. KHC provides policy and Q&A resources that lenders use, which you can review in Ask KHC.
Avoid pitfalls and scams
Only work with KHC‑approved lenders and counseling agencies. Confirm program details on KHC’s official site, and be wary of unsolicited offers that promise guaranteed approval or free money. You can start at the main Kentucky Housing Corporation website to confirm you are looking at the real program.
Who to contact in Madison County
KHC maintains a county page with approved lenders and counselors serving Richmond and nearby areas. You will see familiar names like Stockton Mortgage, US Bank NA, Central Bank & Trust Co., and Revolution Mortgage among others. Use that page to find local contacts, then interview two or three to compare options and service.
Ready to put a plan together, tour homes, and use KHC help with confidence? Reach out to me for a friendly, no‑pressure consult. I can connect you with trusted KHC‑approved lenders, tailor a search to your budget, and guide you from offer to close. Connect with Natalie Cusic to get started.
FAQs
What is KHC Down Payment Assistance and how does it work?
- It is a repayable second loan from KHC that helps cover your down payment and closing costs, and it must be paired with a KHC first mortgage as outlined on KHC’s program page.
What income and price limits apply in Madison County?
- For Secondary Market loans, Madison County’s purchase price limit is $544,232 and the gross applicant income limit is $154,700; check the county page for MRB tiers and updates.
How much assistance can I get and do I have to repay it?
- KHC has offered $10,000 in recent years and has posted temporary increases, such as up to $12,500, that are repayable over a stated term and rate; verify the current amount, rate, and reservation window on the KHC DAP page.
Can I use KHC DAP with FHA, VA, USDA, or conventional loans?
- Yes, when you use a KHC first mortgage, the DAP works with FHA, VA, USDA, and conventional options, and program limits follow the first‑mortgage type.
Is homebuyer education required for KHC loans?
- It depends on your profile, such as whether all borrowers are first‑time buyers; your lender will confirm and can direct you to approved education, which is described in KHC program materials here.
How long does the process take from contract to closing?
- Timelines vary by lender and file, but many KHC loans follow standard mortgage timing; ask your lender about current turn times and reservation expiration dates.
What happens if I refinance or sell the home?
- The DAP is a second lien with repayment terms; payoff or subordination for a refinance depends on KHC policy, which your lender can confirm and you can preview in Ask KHC.
