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- Credit Scores Required For A Kentucky Mortgage Loan Approval in 2022
- Down Payment Assistance Kentucky 2022 Kentucky Housing Corporation KHC
- Kentucky First-time Home Buyer Programs
- Kentucky FHA Mortgage Information
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- USDA Rural Housing Kentucky Loan Information
- Zero Down Kentucky Mortgages
- First-time Home-buyers in Kentucky
- Documents Needed Mortgage Approval in Kentucky
- 4 Things Required for a KY Mortgage Loan Approval
- Free Credit Score Booklet
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Kentucky USDA Rural Housing Property Eligibility County List Map for Eligible Properties
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Kentucky USDA Rural Housing Mortgage Lender: USDA has announced an upfront guarantee fee of 1% ...: USDA Fiscal Year 2021 Conditional Commitment Notice Fiscal Year 2021 will begin 10/01/2020. USDA has announced an upfront guarantee ...
What do I need to get approved for a Rural Housing Loan in Kentucky?
You really need to look at the four following items below:
Credit Score: They typically want a 640 credit score with no bankruptcies or foreclosures in the last 3 years. KY USDA Loans are initially ran thru GUS (Guarantee Underwriting System), an underwriting approval engine online that Kentucky USDA Mortgage lenders use to tell us how much you are qualified for based on the income, assets, property, and credit provided. Most lenders will want an Approved Eligible. If your score is below 640, you will automatically get a refer eligible which most lenders will not do.
Homeownership: You cannot currently own another home with a USDA loan but there are waivers granted if you can show the current living arrangements are not suitable and safe for your family.
Income: Typically, you cannot make more than $86k approximately for a household family of four, and up to $115k for a household family of five in most Kentucky counties. Some Kentucky Counties are more but not much.
Location: Kentucky has 120 counties, and USDA is not allowed in the following KY Counties: Jefferson, Fayette (whole county) and parts of McCracken, Boone, Kenton, Campbell, Bullitt, Daviess, Warren, Franklin and Christian counties. The best thing to do on the location is tell me an address and I can look it up for you.
I have a website that is really good for USDA loans, located at http://
kentuckyruralhousingusdaloan. blogspot.com/p/usda-rural- housing-loan-program.html that may assist and educate you about the program.
Credit Scores and the Kentucky USDA Rural Development Loan Program
The Kentucky USDA Rural Development Loan Program is by far the most credit score friendly loan program currently available. While USDA is willing to work with scores lower than 640 most lenders won't. Thus, pragmatically the minimum credit score required by USDA is 581.
For Kentucky homebuyers with a minimum credit score of 640 lenders may streamline the credit approval process normally required as part of the underwriting process. This means that a borrower:
|With a lack of credit "depth" will not have to document non-traditional credit items such as utility or insurance payments|
|A negative past credit history may allow the Underwriter to not request letters of explanation for the cause of the past challenges|
|Collection accounts can remain open provided the Underwriter believes it unlikely that the account will eventually turn into a judgment|
However, USDA is not willing to overlook certain overtly negative credit items even when the credit scores are over 640. For instance borrowers with any of the following adverse past credit should not expect to obtain credit approval using the USDA loan program:
|Foreclosure or short sale within the last 3 years|
|Chapter 7 bankruptcy discharged within the past 3 years|
|Chapter 13 bankruptcy debt restricting plan completed within the last 12 months|
|Late mortgage payments within the last 12 months|
|Applicant or co-applicant delinquent on a federal debt; such as taxes, student loans, or previous agency loan (i.e. VA loan in which the eligibility was forfeited due to a foreclosure)|
USDA may be willing to give a borrower an exception to a past bankruptcy or foreclosure prior to the three year period provided the borrower can document the cause of the past negative credit experience as being related to an illness or job loss and unlikely to reoccur.
Once the credit score exceeds 640, USDA allows this score to be considered as justification for allowing the borrowers debt-to-income-ratio to exceed the target ratios of 29% for the housing costs and 41% for the total debt ratio. Frequently USDA will approve loans where the housing ratios are in the high 30% range and total debt ratios are in the high 40% range.
Bottom line the Kentucky USDA Rural Development Loan Program is more flexible in approving a perspective borrower than any other loan program. But like any loan program today, the Loan Officer shouldn't assume that this level of credit flexibility will result in an automatic positive underwriting decision if the Underwriter doesn't feel strongly that the borrowers chance of success at homeownership is strong.
Looking for 100% Financing, No Money Down Home Loan in KY?
Kentucky Rural Housing Development Loans offer:
Effective 10/1/2016 the Up Front Guarantee Fee is reduced to 1.0%*
No down payment required
Up to 6% Seller Concessions
No minimum credit score but most lenders will want a 620 or higher, or 640 to be safe
GUS Accept Eligible (lenders run this for you)
No Bankruptcies or foreclosure in last 3 years
Max household income limits vary
Home must be in an eligible USDA Area. See links below for income and property
For list of eligible properties: Kentucky USDA Property Eligibility Map?
For income eligibility limits: Kentucky RHS USDA Income Eligibility?