Here's a summary of different loan programs for Kentucky first-time homebuyers with a focus on
FHA, VA, USDA Home loans in Kentucky
FHA Loan:Appraisal Requirements:
FHA Loan:
Credit Score: Typically requires a minimum credit score of 580; borrowers with lower scores may still qualify but may need a larger down payment.
Down Payment: Minimum down payment of 3.5%.
Income Ratio: Front-end ratio (housing expenses to income) should not exceed 31%; back-end ratio (total debt to income) should not exceed 43%.
Work History: Generally requires at least two years of steady employment, though exceptions can be made.
Credit, Bankruptcy, and Foreclosure: More forgiving than conventional loans; may consider borrowers with past bankruptcy or foreclosure.
Employment and Work History: Stable employment and income are essential.
Time to Close: Typically around 30-45 days. Appraisal and property requirements follow FHA guidelines.
Credit Score:VA doesn't set a minimum score; lenders may have their requirements, often around 620 or higher.
Down Payment: Minimum down payment of 3.5%.
Income Ratio: Front-end ratio (housing expenses to income) should not exceed 31%; back-end ratio (total debt to income) should not exceed 43%.
Work History: Generally requires at least two years of steady employment, though exceptions can be made.
Credit, Bankruptcy, and Foreclosure: More forgiving than conventional loans; may consider borrowers with past bankruptcy or foreclosure.
Employment and Work History: Stable employment and income are essential.
Time to Close: Typically around 30-45 days. Appraisal and property requirements follow FHA guidelines.
VA Loan:
Down Payment: No down payment required for most borrowers.
Income Ratio: Flexible debt-to-income ratios, often up to 41% or higher in certain cases.
Work History: Stable employment history is preferred.
Credit, Bankruptcy, and Foreclosure: More lenient on past credit issues; may consider borrowers with past bankruptcy or foreclosure.
Employment and Work History: Consistent income from stable employment is crucial.
Time to Close: VA loans can take 45-60 days to close. Appraisal and property requirements must meet VA standards.
Income Ratio: Flexible debt-to-income ratios, often up to 41% or higher in certain cases.
Work History: Stable employment history is preferred.
Credit, Bankruptcy, and Foreclosure: More lenient on past credit issues; may consider borrowers with past bankruptcy or foreclosure.
Employment and Work History: Consistent income from stable employment is crucial.
Time to Close: VA loans can take 45-60 days to close. Appraisal and property requirements must meet VA standards.
USDA Loan:
Credit Score: Typically requires a minimum credit score of 640; exceptions may be possible with compensating factors.
Down Payment: No down payment required for eligible borrowers.
Income Ratio: Maximum debt-to-income ratio of 41%, though exceptions may be made with strong compensating factors.
Work History: Stable employment history is preferred, typically two years or more.
Credit, Bankruptcy, and Foreclosure: Consideration for borrowers with past credit issues, bankruptcy, or foreclosure.
Employment and Work History: Consistent income from stable employment is important.
Time to Close: USDA loans may take 30-60 days to close. Appraisal and property requirements must meet USDA guidelines.
Each loan program has specific eligibility criteria and requirements, so it's essential for first-time homebuyers to consult with lenders or mortgage experts to determine the best fit based on their financial situation and goals.
Down Payment: No down payment required for eligible borrowers.
Income Ratio: Maximum debt-to-income ratio of 41%, though exceptions may be made with strong compensating factors.
Work History: Stable employment history is preferred, typically two years or more.
Credit, Bankruptcy, and Foreclosure: Consideration for borrowers with past credit issues, bankruptcy, or foreclosure.
Employment and Work History: Consistent income from stable employment is important.
Time to Close: USDA loans may take 30-60 days to close. Appraisal and property requirements must meet USDA guidelines.
Each loan program has specific eligibility criteria and requirements, so it's essential for first-time homebuyers to consult with lenders or mortgage experts to determine the best fit based on their financial situation and goals.
Appraisal requirements and income documentation
FHA Loan:Appraisal Requirements:
The property must meet FHA guidelines, including minimum property standards and safety requirements. An FHA-approved appraiser assesses the property's value and condition.
Income Documentation: Generally requires recent pay stubs, W-2 forms, tax returns for the past two years, and proof of additional income sources (if applicable).
VA Loan:Appraisal Requirements:
Income Documentation: Generally requires recent pay stubs, W-2 forms, tax returns for the past two years, and proof of additional income sources (if applicable).
VA Loan:Appraisal Requirements:
VA loans require a VA appraisal conducted by a VA-assigned appraiser. The appraisal assesses the property's value and ensures it meets VA's Minimum Property Requirements (MPRs).
Income Documentation: Typically includes pay stubs, W-2 forms, tax returns for the past two years, and proof of any additional income (e.g., bonuses, alimony, rental income).
USDA Loan:Appraisal Requirements:
Income Documentation: Typically includes pay stubs, W-2 forms, tax returns for the past two years, and proof of any additional income (e.g., bonuses, alimony, rental income).
USDA Loan:Appraisal Requirements:
USDA loans require a USDA appraisal to determine the property's value and ensure it meets USDA's standards for safety and livability.
Income Documentation:
Similar to FHA and VA loans, USDA loans require pay stubs, W-2 forms, tax returns for the past two years, and documentation of other income sources.
These appraisal requirements and income documentation are crucial parts of the loan application process. Lenders use this information to assess the property's value, ensure it meets safety standards, and verify the borrower's income stability and ability to repay the loan.
These appraisal requirements and income documentation are crucial parts of the loan application process. Lenders use this information to assess the property's value, ensure it meets safety standards, and verify the borrower's income stability and ability to repay the loan.
Hope your day is full of sunshine
Joel Lobb Mortgage Loan Officer
American Mortgage Solutions, Inc.10602 Timberwood Circle
Louisville, KY 40223
Company NMLS ID #1364
Text/call: 502-905-3708
fax: 502-327-9119
email: kentuckyloan@gmail.com
http://www.mylouisvillekentuckymortgage.com/
NMLS 57916 | Company NMLS #1364/MB73346135166/MBR1574
NMLS ID# 57916, (www.nmlsconsumeraccess.org).
.jpg "Applies to case numbers assigned on or after June 1, 2022 Updates the initial appraisal validity period from 120 days to 180 days from the effective date of the appraisal report; Extends the appraisal update validity period from 240 days to one year from the effective date of the initial appraisal report; Allows the appraisal update to be ordered AFTER an appraisal expires; and Eliminates the optional 30-day extension. ✨This is big news for FHA ✨ The guideline change also puts FHA appraisal expirations on par with conventional loan expiration dates.")
