Finance
A Kentucky USDA Rural Development loan is best suited for buyers who:
AAre purchasing in urban Louisville or Lexington
BHave excellent credit and large down payments
CAre purchasing in eligible rural areas with low-to-moderate income✓ Correct
DAre active military service members
Explanation
USDA Rural Development loans (Section 502) are designed for low-to-moderate income buyers purchasing in eligible rural areas. Kentucky has many USDA-eligible areas.
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Key Terms to Know
Amortization
The gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
Math Concepts
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