Kentucky Mortgage Loan Programs

FHA Pricing Improvements Any FICO (down to 550) Conventional Pricing Improvements Any FICO ( down to 580) Non-Traditional Credit/ No Score Options Available on FHA, VA and USDA FreddieMac ChoiceRenovation Down to 580 Fico EasyPath FHA 203K Limited and standard Down to 620 FICO Purchase and Refinance options LOWER FICO OPTIONS Down to 550 FICO on FHA and VA Down to 580 FICO on USDA and Conventional MANUAL UW OPTIONS FHA, VA & USDA CASH OUT REFINANCES FHA and VA down to 550 FICO VA cash-out up to 100 LTV Manual Underwrite options Manufactured housing options MANUFACTURED HOMES Single and multi-wide options Available for FHA, VA, USDA and conventional Options for manufactured homes built after June 15th 1976 USDA 97% of the USA is eligible 100% LTV available USDA Streamline NO FICO allowed Escrow holdbacks allowed DACA and EAD allowed FICOs down to 580 Temporary Buydowns Currently available on FHA, VA and Conventional loans

Kentucky USDA Rural Housing Mortgage Lender: Understanding Kentucky USDA Home Loan Approval Gui...

Kentucky USDA Rural Housing Mortgage Lender: Understanding Kentucky USDA Home Loan Approval Gui...:   Understanding Kentucky USDA Home Loan Approval Guidelines in 2024 If you're looking to buy a home in Kentucky and considering a USDA l...

Understanding Kentucky USDA Home Loan Approval Guidelines in 2024

 Understanding Kentucky USDA Home Loan Approval Guidelines in 2024

If you're looking to buy a home in Kentucky and considering a USDA loan, understanding the approval guidelines is crucial. The USDA (United States Department of Agriculture) offers loans specifically designed for rural and suburban homebuyers with favorable terms. Here's a comprehensive look at what you need to know about credit score requirements, income criteria, work history, debt ratio considerations, bankruptcy and foreclosure history, down payment expectations, mortgage insurance, income limits, and the USDA's Guaranteed Underwriting System (GUS) and manual underwriting process.

Types of Kentucky Mortgages for Homebuyers in Kentucky

 

Here is a quick summary of the 3 loans for Kentucky Homebuyers , but we will go into each of them in depth further down. Types of Kentucky mortgages Conventional loan – Best for borrowers with a good credit score Jumbo loan – Best for borrowers with excellent credit looking to buy an expensive home Government-insured loan – Best for borrowers who have lower credit scores and not much cash for a down payment Fixed-rate mortgage – Best for borrowers who want the predictability of the same payments throughout the entire loan Adjustable-rate mortgage – Best for borrowers who do not plan to stay in the home for a long time, and are comfortable with the risk of larger payments down the road 1. Kentucky Conventional Loan Conventional loans are not backed by the federal government, and they come in two packages: conforming and non-conforming. Conforming loans – As the name implies, a conforming loan “conforms” to a set of standards put in place by the Federal Housing Finance Agency (FHFA). The standards include a range of factors about your credit and debt, but one of the main pieces is the size of the loan. Non-conforming loans – These loans do not meet FHFA standards. They might be for larger homes, or they might be offered to borrowers with subpar credit. Some non-conforming loans are designed for those who have gone through major financial catastrophes such as a bankruptcy. Pros of conventional loans Can be used for a primary home, second home or investment property Overall borrowing costs tend to be lower than other types of mortgages, even if interest rates are slightly higher Can ask your lender to cancel private mortgage insurance (PMI) once you’ve reached 20 percent equity, or refinance to remove it Can pay as little as 3 percent down on loans backed by Fannie Mae or Freddie Mac Sellers can contribute to closing costs Cons of conventional loans Minimum FICO score of 620 or higher often required (the same applies for refinancing) Higher down payment than some government loans Must have a debt-to-income (DTI) ratio of no more than 43 percent (50 percent in some instances) Likely need to pay PMI if your down payment is less than 20 percent of the sales price Significant documentation required to verify income, assets, down payment and employment Who should get a conventional loan If you have a strong credit score and can afford to make a sizable down payment, a conventional mortgage is probably your best pick. The 30-year, fixed-rate conventional mortgage is the most popular choice for homebuyers. 2. Jumbo Loans Jumbo mortgages are appropriately named: These are loans that fall outside FHFA limits. Jumbo loans are more common in higher-cost areas such as Los Angeles, San Francisco, New York City and the state of Hawaii. More money means more risk for the lender, so these generally require more in-depth documentation to qualify. Pros of jumbo loans Can borrow more money to buy a more expensive home Interest rates tend to be competitive with other conventional loans Cons of jumbo loans Down payment of at least 10 percent to 20 percent needed A FICO score of 700 or higher typically required Cannot have a DTI ratio above 45 percent Must show you have significant assets in cash or savings accounts Who should get a jumbo loan? If you’re looking to finance a sum of money larger than the latest conforming loan limits, a jumbo loan is likely your best route. 3. Kentucky Government-Insured Loan The U.S. government isn’t a mortgage lender, but it does play a role in helping more Americans become homeowners. Three government agencies back mortgages: the Federal Housing Administration (FHA loans), the U.S. Department of Agriculture (USDA loans) and the U.S. Department of Veterans Affairs (VA loans). Kentucky FHA loans – Backed by the FHA, these types of home loans help make homeownership possible for borrowers who don’t have a large down payment saved up or don’t have pristine credit. FHA loans require two mortgage insurance premiums: one is paid upfront, and the other is paid annually for the life of the loan if you put less than 10 percent down, which can increase the overall cost of your mortgage. Lastly, with an FHA loan, the home seller is allowed to contribute to closing costs. Kentucky USDA loans – USDA loans help moderate- to low-income borrowers buy homes in rural areas. You must purchase a home in a USDA-eligible area and meet certain income limits to qualify. Some USDA loans do not require a down payment for eligible borrowers with low incomes. There are extra fees, though, including an upfront fee of 1 percent of the loan amount (which can typically be financed with the loan) and an annual fee. Kentucky VA loans – VA loans provide flexible, low-interest mortgages for members of the U.S. military (active duty and veterans) and their families. VA loans do not require a down payment or mortgage insurance, and closing costs are generally capped and may be paid by the seller. A funding fee is charged on VA loans as a percentage of the loan amount to help offset the program’s cost to taxpayers. This fee, as well as other closing costs, can be rolled into most VA loans or paid upfront at closing. Many lenders offer the lowest rates possible on VA loans, and some are willing to accept lower credit scores. Pros of government-insured loans Help you finance a home when you don’t qualify for a conventional loan Credit requirements more relaxed Don’t need a large down payment Available to repeat and first-time buyers No mortgage insurance and no down payment required for VA loans Cons of government-insured loans Mandatory mortgage insurance premiums on FHA loans that cannot be canceled unless refinancing into a conventional mortgage Loan limits on FHA loans are lower than conventional mortgages in most areas, limiting potential inventory to choose from Borrower must live in the property (although you may be able to finance a multi-unit building and rent out other units) Could have higher overall borrowing costs Expect to provide more documentation, depending on the loan type, to prove eligibility Who should get a government-insured loan? If you cannot qualify for a conventional loan due to a lower credit score or limited savings for a down payment, Kentucky FHA-backed and USDA-backed loans are a great option. For military service members, veterans and eligible spouses, VA-backed loans can be a good option — often better than a conventional loan. Other types of Kentucky home loans In addition to these common kinds of Kentucky mortgages, there are other types you may find when shopping around for a loan: Construction loans – If you want to build a home, a construction loan can be a good choice. You can decide whether to get a separate construction loan for the project and then a separate mortgage to pay it off, or wrap the two together (known as a construction-to-permanent loan). You typically need a higher down payment for a construction loan and proof that you can afford it. Interest-only mortgages – With an interest-only mortgage, the borrower pays only the interest on the loan for a set period of time. After that time is over, usually between five and seven years, your monthly payment increases as you begin paying your principal. With this type of loan, you won’t build equity as quickly, since you’re initially only paying interest. These loans are best for those who know they can sell or refinance, or for those who can reasonably expect to afford the higher monthly payment later. Piggyback loans – A piggyback loan, also referred to as an 80/10/10 loan, actually involves two loans: one for 80 percent of the home price and another for 10 percent. Then, you make a down payment of 10 percent. These are designed to help the borrower avoid paying for mortgage insurance. While eliminating those PMI payments might sound appealing, keep in mind that piggyback loans require two sets of closing costs and two loans accruing interest. You’ll need to crunch the numbers to find out if you’re really saving enough money to justify this unconventional arrangement. Balloon mortgages – Another type of home loan you might come across is a balloon mortgage, which requires a large payment at the end of the loan term. Generally, you’ll make payments based on a 30-year term, but only for a short time, such as seven years. At the end of that time, you’ll make a large payment on the outstanding balance, which can be unmanageable if you’re not prepared.

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

The view and opinions stated on this website belong solely to the authors, and are intended for informational purposes only. The posted information does not guarantee approval, nor does it comprise full underwriting guidelines. This does not represent being part of a government agency. The views expressed on this post are mine and do not necessarily reflect the view of my employer. Not all products or services mentioned on this site may fit all people.
NMLS ID# 57916, (www.nmlsconsumeraccess.org).

What goes into your FICO® Scores for A Kentucky Mortgage ?

 

What goes into your Kentucky Mortgage FICO®  Scores ?

The FICO® Score is calculated using 5 categories of data:

• 35% Payment history: Whether you've paid past credit accounts on time.
• 30% Amounts owed: The amount of credit and loans you are using.
• 15% Length of credit history: How long you've had credit.
• 10% New credit: Your frequency of credit inquiries and new account openings.
• 10% Credit mix: The mix of your credit cards, retail accounts, installment loans and mortgages.

Your FICO Scores are unique, just like you. They are calculated based on the categories described above, but for some people, the importance of these categories can be different.

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

The view and opinions stated on this website belong solely to the authors, and are intended for informational purposes only. The posted information does not guarantee approval, nor does it comprise full underwriting guidelines. This does not represent being part of a government agency. The views expressed on this post are mine and do not necessarily reflect the view of my employer. Not all products or services mentioned on this site may fit all people.
NMLS ID# 57916, (www.nmlsconsumeraccess.org).

Louisville Kentucky Mortgage Lender for FHA, VA, KHC, USDA and Rural Housing Kentucky Mortgages: Kentucky FHA Mortgage Loans vs Kentucky USDA Rural...

Louisville Kentucky Mortgage Lender for FHA, VA, KHC, USDA and Rural Housing Kentucky Mortgages: Kentucky FHA Mortgage Loans vs Kentucky USDA Rural...: Here are the important points about Kentucky USDA Rural Housing Loans: USDA loan are only available in certain counties of Kentucky. ...

Louisville Kentucky Mortgage Lender for FHA, VA, KHC, USDA and Rural Housing Kentucky Mortgages: WHAT IS THE MINIMUM CREDIT SCORE FOR A KENTUCKY FH...

Louisville Kentucky Mortgage Lender for FHA, VA, KHC, USDA and Rural Housing Kentucky Mortgages: WHAT IS THE MINIMUM CREDIT SCORE FOR A KENTUCKY FH...: Kentucky FHA Mortgage Credit Score Requirements FHA is introducing new guidelines on loan to value ratios and the minimum credit score requ...

Mortgage Insurance Requirements for Kentucky FHA, VA, USDA and Fannie Mae Home Loans

When does PMI stop on Kentucky FHA, USDA, and Conventional Loans?

How Can I Get Rid of PMI? 

Does PMI stop on my loan once I am under 80%? Not on all loans!

When does PMI stop on my loan? Will PMI drop off? How can I remove PMI off my loan? Each type of mortgage loan treats PMI ( Private Mortgage Insurance) differently. See below for a quick summary!

Kentucky USDA Loans- PMI is for the life of the loan

PMI private mortgage insurance advantages & strategies for lower down payment and payment USDA has an annual fee which is similar to PMI. The annual fee is recalculated each year based on the new balance of the mortgage. The annual fee is currently only .35 which began October 1, 2016. The annual fee percentage on USDA loans stays for the entire 30 year term but because it is based on the annual mortgage balance. Therefore, the dollar amount decreases each year.

 

How to calculate monthly PMI for USDA loans: Loan amount x 1.0101% (USDA funding fee) x .0035 / 12 = monthly fee to include in the monthly mortgage payment.

Kentucky FHA Loan PMI often continues for the life of the loan, but depends!

FHA has an annual fee but the percentage varies depending on the LTV and the loan term. The monthly amount of PMI is recalculated each year based on the new balance of the mortgage and the PMI percentage.

The length of time that FHA PMI stays on the loan varies depending on the loan term and LTV as shown below:

 

 Loans over 90% LTV or more will pay the annual PMI for the complete term – On a purchase, this means less than 10% down

 Loans equal to or less than 90% LTV will pay the annual PMI for 11 years – Purchases over 10% down payment

Loan terms greater than 15 years < $625,500: effective 1/26/15

 > 95% LTV =.85 PMI

 -< 95% LTV =.80 PMI

 

Loan terms 15 years or less < $625,500:

 -< 90% LTV =.45 PMI

 > 90% LTV =.70 PMI

 

Even though FHA PMI currently continues for the life of the loan with less than 10% down payment, it is still a great loan for buyers. It offers low down payment, very competitive rates, and flexibility on many guidelines.

Kentucky VA home loans DO NOT have monthly PMI

 

VA loans do not have monthly PMI on any of the terms so you don’t have to worry about when it continues. Like all government loans, VA does have a funding fee which is an up-front fee that is customarily financed on top

of the loan amount and required by the VA. Although VA does allow the Veteran or even the seller pay this fee! Additionally, qualified, disabled Veterans may be exempt from the VA funding fee. Ask about the requirements re: the waiver of the funding fee.

Kentucky Fannie Mae or Freddie Mac conventional loans have PMI when the LTV is greater than 80% with either primary, second homes, or investment properties. To cancel PMI on a conventional loan, the following typically needs to be met. Here are some of the details to have PMI stop as clarified by the Consumer Financial Protection Bureau in August 2015.

 Borrower Requested PMI Cancellation: Once balance is paid to under 80% of the original price, the borrower may request that PMI be cancelled on the cancellation date. The cancellation date means either the date when the principal balance is first scheduled to reach 80% of the original value (lower of purchase price or

appraised value) for the property or date on which the principal balance reaches 80% of the original value based on actual payments. The borrower may make extra payments to move the cancellation date earlier.

 Automatic PMI Cancellation: Once balance is paid to under 78% of the original price, the lender must cancel the PMI on the termination date. The termination date is defined as the date which the principal balance is first scheduled to reach 78% of the original value for the property. Although before cancelling PMI, the loan must be current.

“Good payment history” means no payments 60 or more days past due within 2 years and no payments 30 or more days past due within 1 year of the later of the cancellation date or the date you submit a request for cancellation.

 

** PMI could be cancelled on a conventional mortgage if the following conditions are satisfied:

 You submit a written request for cancellation  Borrower must be current on the loan.

 You are current on the payments required by your loan and if requested and at the borrower’s expense, evidence satisfactory to the note holder that the value of the property has not declined below it’s original value (value at the time of the mortgage initiation), and that there are no subordinate liens on the property

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

The view and opinions stated on this website belong solely to the authors, and are intended for informational purposes only. The posted information does not guarantee approval, nor does it comprise full underwriting guidelines. This does not represent being part of a government agency. The views expressed on this post are mine and do not necessarily reflect the view of my employer. Not all products or services mentioned on this site may fit all people.
NMLS ID# 57916, (www.nmlsconsumeraccess.org).