See programs you qualify for
Get Matched Free →By Tyler Thompson · Licensed Real Estate Agent · Updated April 11, 2026
Homebuyer Programs in Lexington, KY (2026)
Lexington is Kentucky's second-largest city and a consolidated city-county government merged with Fayette County, with a median home price around $330,000. The city offers several homebuyer assistance options including the Lexington First-Time Homebuyer Program administered through REACH Inc. and local Habitat affiliates, and the REACH HOME Program which provides up to $30,000 in forgivable second mortgage assistance for households earning below 80% AMI. University of Kentucky employees can access up to $15,000 through the UK Employer Assisted Housing Program. At the state level, KHC Regular DAP adds up to $12,500 and the KHC Affordable DAP provides up to $7,500 for lower-income buyers. The Lexington Community Land Trust and Lexington Habitat for Humanity also provide permanently affordable homeownership paths for qualifying buyers.
City Programs in Lexington
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| Lexington First-Time Homebuyer Program | Forgivable Loan | Varies by administering partner. Non-repayable subsidies and 0-2% interest loans available. | Yes | View → |
| Lexington Housing Authority Homeownership Program | Forgivable Loan | Up to $100,000 in assistance for qualifying applicants | No | View → |
| University of Kentucky Employer Assisted Housing Program | Forgivable Loan | Up to $15,000 (5% of home purchase price) | No | View → |
- Type:
- Forgivable Loan
- Amount:
- Varies by administering partner. Non-repayable subsidies and 0-2% interest loans available.
- First-time only:
- Yes
- Type:
- Forgivable Loan
- Amount:
- Up to $100,000 in assistance for qualifying applicants
- First-time only:
- No
- Type:
- Forgivable Loan
- Amount:
- Up to $15,000 (5% of home purchase price)
- First-time only:
- No
State Programs in Kentucky
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| FHLB Cincinnati Welcome Home Program | Grant | Grants of $10,000 to $20,000; up to $25,000 for veterans, active-duty military, and surviving spouses | Yes | View → |
| KHC Affordable Down Payment Assistance (Affordable DAP) | Repayable Loan | Up to $7,500 | No | View → |
| KHC Regular Down Payment Assistance (DAP) | Repayable Loan | Up to $12,500 | No | View → |
- Type:
- Grant
- Amount:
- Grants of $10,000 to $20,000; up to $25,000 for veterans, active-duty military, and surviving spouses
- First-time only:
- Yes
- Type:
- Repayable Loan
- Amount:
- Up to $7,500
- First-time only:
- No
- Type:
- Repayable Loan
- Amount:
- Up to $12,500
- First-time only:
- No
Federal Programs
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| FHA Loans | Government-Insured Mortgage | Up to FHA county loan limits ($541,287 floor to $1,249,125 ceiling for single-family in 2026) | No | View → |
| Good Neighbor Next Door (HUD) | Government Property Sale Program | 50% discount off the list price of HUD-owned homes | Yes | View → |
| Home Possible Mortgage (Freddie Mac) | Government-Guaranteed Mortgage | Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment | No | View → |
| HomeReady Mortgage (Fannie Mae) | Government-Guaranteed Mortgage | Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment | No | View → |
| HUD $100 Down Program | FHA-Financed HUD REO Purchase | Only $100 down payment required (vs. standard 3.5% FHA down payment). HUD may also pay up to 3% of buyer's closing costs. | No | View → |
| USDA Rural Development Loans | Government-Guaranteed Mortgage | 100% financing (no down payment required); loan amount up to appraised value | No | View → |
| VA Loans | Government-Guaranteed Mortgage | No loan limit for veterans with full entitlement (0% down at any price); partial entitlement subject to conforming limits ($832,750 standard in 2026) | No | View → |
- Type:
- Government-Insured Mortgage
- Amount:
- Up to FHA county loan limits ($541,287 floor to $1,249,125 ceiling for single-family in 2026)
- First-time only:
- No
- Type:
- Government Property Sale Program
- Amount:
- 50% discount off the list price of HUD-owned homes
- First-time only:
- Yes
- Type:
- Government-Guaranteed Mortgage
- Amount:
- Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment
- First-time only:
- No
- Type:
- Government-Guaranteed Mortgage
- Amount:
- Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment
- First-time only:
- No
- Type:
- FHA-Financed HUD REO Purchase
- Amount:
- Only $100 down payment required (vs. standard 3.5% FHA down payment). HUD may also pay up to 3% of buyer's closing costs.
- First-time only:
- No
- Type:
- Government-Guaranteed Mortgage
- Amount:
- 100% financing (no down payment required); loan amount up to appraised value
- First-time only:
- No
- Type:
- Government-Guaranteed Mortgage
- Amount:
- No loan limit for veterans with full entitlement (0% down at any price); partial entitlement subject to conforming limits ($832,750 standard in 2026)
- First-time only:
- No
Nonprofit Programs
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| Lexington Community Land Trust | Zero-Interest Loan | Subsidized home pricing through community land trust model | No | View → |
| Lexington Habitat for Humanity Homeownership Program | Zero-Interest Loan | Below-market home purchase with $1,500 closing cost contribution from buyer | No | View → |
| REACH HOME Program | Forgivable Loan | Up to $20,000-$30,000 (varies by household size: $20,000 for 1-person, $25,000 for 2-person, $30,000 for 3+ persons) | Yes | View → |
- Type:
- Zero-Interest Loan
- Amount:
- Subsidized home pricing through community land trust model
- First-time only:
- No
- Type:
- Zero-Interest Loan
- Amount:
- Below-market home purchase with $1,500 closing cost contribution from buyer
- First-time only:
- No
- Type:
- Forgivable Loan
- Amount:
- Up to $20,000-$30,000 (varies by household size: $20,000 for 1-person, $25,000 for 2-person, $30,000 for 3+ persons)
- First-time only:
- Yes
How to Apply
Step 1: Check your eligibility. Most Lexington programs target buyers earning at or below 80% AMI for Fayette County. The Lexington First-Time Homebuyer Program requires first-time buyer status. KHC state programs have a purchase price limit of $544,232.
Step 2: Complete homebuyer education. Nearly all Lexington programs require homebuyer education. REACH Inc. at (859) 455-8057 offers HUD-approved courses locally, and Community Ventures Corporation at (859) 231-0054 provides eHome America online coursework.
Step 3: Contact a local housing partner. REACH Inc. at 733 Red Mile Road administers the REACH HOME Program (up to $30,000). Lexington Habitat for Humanity at (859) 252-2224 offers affordable home purchases. The Lexington Community Land Trust at (859) 303-5223 provides permanently affordable homeownership.
Step 4: Get pre-approved for a mortgage. Work with a KHC-approved lender if you plan to use state DPA programs. Your lender can help determine which programs you qualify for and how to stack assistance.
Step 5: Find a home within program guidelines. Some programs restrict purchases to specific areas — the UK Employer Assisted Housing Program requires homes in designated neighborhoods near campus, and the Housing Authority program offers new construction at Equestrian View Subdivision.
Step 6: Submit your full application and close. Your lender and housing counselor will coordinate the DPA funding with your first mortgage. Note that city funding is cyclical — check current availability with your housing partner.
Frequently Asked Questions
How much down payment assistance can I get in Lexington?+−
Do I have to be a first-time homebuyer to qualify?+−
What is the maximum home price I can pay?+−
What homebuyer education is required?+−
Are there programs for University of Kentucky employees?+−
Is Lexington homebuyer funding always available?+−
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