Kentucky
Building a Home in Kentucky with a VA One-Time Close Loan
Picture a soldier at Fort Knox with a lot picked out near Elizabethtown. This page walks that build from contract to keys, and shows where Kentucky's markets help or hurt.
Home Loans Inc is not licensed in Kentucky and cannot take a Kentucky loan application. We originate in South Carolina | North Carolina | Virginia | West Virginia | Florida | Georgia | Alabama | Mississippi | Iowa | Wyoming.
A Fort Knox build, start to finish
Say you work at Fort Knox, maybe for Cadet Command or Human Resources Command, and you have your eye on a lot outside Radcliff or Elizabethtown. You want a new house, not someone else's 1990s kitchen. A VA one-time close loan lets you fold the lot, the construction and the permanent mortgage into one loan with one closing, and with full entitlement you can do it with zero down.
Here is the order of operations. You pick a builder who is VA-registered with a VA builder ID. The builder produces plans and specs, including VA Form 26-1852, the description of materials. A VA appraiser values the house as if it were already finished and issues a Notice of Value. If that value covers your Total Acquisition Cost, which is the lot, the build, the contingency, accrued interest and the funding fee, you close once and construction starts.
Then the builder gets paid in stages, each draw released after an inspection. You carry interest during the build, so a slow builder costs you real money. When the house is done, the loan simply becomes your mortgage.
One thing to say plainly before going further: Home Loans Inc is not licensed in Kentucky and cannot take your application. Kentucky does border Virginia and West Virginia, two states where we are licensed, but a Kentucky property needs a Kentucky-licensed lender. Use this as your briefing.
Where Kentucky comps help and where they hurt
The Elizabethtown scenario above lands in a military-influenced market with moderate comps. Here is how the rest of the state looks to an appraiser.
Louisville metro
Largest metro
Moderate to strong comps and the deepest pool of sales in the state. A good place to start if location is flexible.
Lexington
Growing market
University and horse country, with growth that keeps adding new construction to the comp pool.
Northern Kentucky
Cincinnati suburbs
A strong market tied to the Cincinnati economy, with solid support for a sensible plan.
Bowling Green
Growing, affordable
Lower costs make the math friendlier, but keep the finish level close to what nearby homes sell for.
Hopkinsville
Fort Campbell, KY side
A small military market. Most Fort Campbell housing sits on the Tennessee side, so Kentucky-side comps can be limited.
Richmond
Blue Grass Army Depot
A smaller community around the depot. Ask your lender how far the appraiser may need to reach for comparable sales.
The Fort Campbell line-straddling problem
Fort Campbell and the 101st Airborne sit on the Kentucky and Tennessee border, and most of the military housing is on the Tennessee side. If you are hunting land on the Kentucky side near Hopkinsville, remember that the state of the lot, not the post, decides which licenses your lender needs and which closing rules apply. It also decides your comps. A Kentucky lot is usually appraised against Kentucky sales, and on this side of the line that pool is small.
Kentucky closing and signing rules
In Kentucky either a title company or an attorney can close; neither is mandated. The state still recognizes dower and curtesy, and on refinances a non-borrowing spouse generally signs the security instrument to release that marital interest even when not on title. Expect your lender to raise the same question at a construction closing, and do not be surprised if your spouse needs to show up. Kentucky does not impose a mortgage recording tax, so recording costs are flat county fees. Foreclosure is judicial.
Before any of that, price the build honestly with the cost estimator, check your eligibility at do you qualify, and remember many lenders want a credit score around 660 for this loan. The funding fee at zero down is 2.15 percent on first use and 3.3 percent after, waived if you receive VA disability compensation.
Kentucky VA OTC questions
My spouse is not on the loan. Will they still have to sign at a Kentucky closing?
Probably. Kentucky still recognizes dower and curtesy, and a non-borrowing spouse generally signs the security instrument to release that marital interest even when they are not on title. Ask the Kentucky-licensed lender and closing agent early so nobody is caught off guard on closing day.
Is it smarter to build on the Tennessee side if I am at Fort Campbell?
It depends on the lot and your plans, not on the post. Most Fort Campbell housing is on the Tennessee side, which can mean more comps there, while the Kentucky side around Hopkinsville is a small military market. Compare appraisal support and lender options in each state before you choose land.
Which Kentucky metros give a VA construction appraisal the best shot?
Louisville has the largest market with moderate to strong comps, Northern Kentucky benefits from the Cincinnati economy, and Lexington is growing. Smaller markets such as Hopkinsville or Richmond can work, but the appraiser may have fewer close matches for a new custom home.
Can Home Loans Inc do my Kentucky one-time close since you are licensed next door?
No. Home Loans Inc holds licenses in Virginia and West Virginia, but it is not licensed in Kentucky and cannot take an application for Kentucky property. Shop lenders licensed in Kentucky who close VA one-time close loans regularly, and use the VAOTC.com tools to prepare.