Kentucky Rural Housing Service (RHS) program Mortgage

Kentucky Rural Housing Service (RHS) program Mortgage

Program Descriptions RHS Fixed Rate 2 6/15/2011

The loan must meet the minimum FICO requirement listed in the following grids: Loans must be manually underwritten. Second Homes and Investment properties are not eligible. LTV/CLTV/HCLTV/FICO Primary Residence

Min Fico 640 Ranges FICO Type Units *LTV CLTV HCLTV Salaried Self-Employed Purchase & Rate/Term Refinance 1 103.5% 100% NA 640 640 1 101% 100% NA 640 640

* Purchase: Maximum LTV is 103.5% of appraised value when guarantee fee is financed. Refinance: Maximum LTV is 101% of appraised value when guarantee fee is financed. Rate & Term refinancing is available on current RHS loans only.

Calculation of the Guarantee Fee: The Guarantee Fee may be calculated in two ways depending on whether the fee will be financed. Transaction Type Guarantee Fee Not Financed Guarantee Fee Financed Purchase Transactions Multiply the loan amount by 3.50% and round to the nearest cent. Example: $100,000 x .035 = $3,500. The fee is calculated as follows: 1. Divide the base loan amount by .965 and round to the nearest cent. 2. Multiply that number by .035 (3.50%) and round to the nearest cent. Example: $100,000 ÷ .965 = $103,626.943005 (rounded to $103,626.94). $103,626.94 x .035 = $3,626.9429 (rounded to $3,626.94). Rate and Term Refinances Multiply the loan amount by 1.00%. Example: $100,000 x .01 = $1,000. Follow steps 1 and 2 above, substituting 99 for .965 and .01 for .035. Example: $100,000 ÷ .99 = $101,010.10. $101,010.10 x .01 = $1,010.10.

Secondary financing may be used if it is approved by RHS and is offered by city or county agencies. SECONDARY FINANCING

Refinance transactions must comply with the following requirements: REFINANCE REQUIREMENTS • The interest rate cannot exceed the interest rate of the existing loan. • The loan security must include the same property as the original loan. The security property must be owner-occupied as the borrower’s primary residence. • Maximum loan amount cannot exceed the balance of the loan being refinanced, plus the guarantee fee and reasonable and customary closing costs (including funds necessary to establish a new tax and insurance escrow account). Subordinate financing, such as home equity lines of credit and down payment assistance “silent” seconds, cannot be included in the new loan amount. Unpaid fees, such as late fees due the servicer, cannot be included in the new loan amount. • Any existing secondary financing must be subordinate to the first lien. • Cash-out is not allowed. • HUD-1 cannot reflect cash back to the borrower except for items prepared by the borrower outside of closing.


The rural Housing Service (RHS) program provides very-low-, low- and moderate-income rural resident with better access to affordable housing finance options with little or no down payment or out-of-pocket costs.

Borrowers may obtain a loan to purchase a new or existing home that is located in a designated rural area. A rural community generally has a population of 10,000 or less; however, a community with a population of 20,000 or less can be considered “rural” if it is located outside a metropolitan statistical area (MSA).

To be eligible for RHS assistance, borrowers must lack sufficient resources (for example, borrower is unable to secure the necessary down payment which is generally 20%, to obtain conventional financing without RHS guarantee assistance). Guidelines for the program follow.


30 year fixed rate



• Rate term refinance (only allowed when refinancing a current Rural Housing Guaranteed loan.)


Owner occupied only


Borrowers are subject to the following eligibility requirements:

• Borrowers may have only one residence. Borrowers may be the current owner of a structurally sound, functionally adequate house, as long as it is sold prior to or concurrently with the purchase of the new home.

• Borrowers must lack sufficient resources (for example, borrower is unable to secure the necessary down payment which is generally 20%, to obtain conventional financing without RHS guarantee assistance).

• Borrowers must have a valid Social Security Number.

• Borrower may be a permanent or non-permanent resident alien. Refer to the Underwriting Guide for details.

• Title must be in individual names only.

• All borrowers must be screened using CAIVRS (Credit Alert Interactive Voice Response System) to determine if an applicant is delinquent on a federal loan.


Non-occupant co-borrowers


Prepayment Penalty Option is not available.


The LTV is based on the appraised value. Minimum 80.01% LTV is required on all purchase transactions. The minimum loan amount is $30,000. Loan limits are dictated by the applicant’s income with respect to program eligibility and loan repayment ability. The maximum loan amount is 100% of the conforming loan limit or 103.5% when the Guarantee Fee is financed.

 Program Descriptions RHS Fixed Rate

2 6/15/2011


The loan must meet the minimum FICO requirement listed in the following grids: Loans must be manually underwritten. Second Homes and Investment properties are not eligible.Primary Residence – Min Fico 640
Ranges  FICO 
Type  Units  *LTV  CLTV  HCLTV  Salaried  Self-Employed 
Purchase & Rate/Term Refinance  103.5%  100%  NA  640  640 
101%  100%  NA  640  640 

Author: Louisville Kentucky Mortgage Broker Offering FHA, VA, USDA, Conventional, and KHC Zero Down Payment Home Loans

I have helped over 589 Kentucky families buy or refinance their home over the last 18 years. Realizing that this is one of the biggest, most important financial transactions a family makes during their lifetime, I always feel honored and respected when I am chosen to originate their personal home loan. You can count on me to deliver on what I say, and I will always give you honest, up-front personal attention you deserve during the loan process. I have several advantages over the large banks in town. First, I can search and negotiate for your loan options through several different mortgage companies across the country to get you the best deal locally. Where most banks will offer offer you their one set of loan products. I have access to over 10 different mortgage companies to broker your loan through to get you the best pricing and loan products that may not fit into the bank's program due to credit, income, or other underwriting issues. You will not get lost in the shuffle like most borrowers do at the mega banks; you're just not a number at our company, you are a person and we will treat you like one throughout the entire process. Give us a try or let us compare your options on your next mortgage transaction. Call me locally at 502-905-3708. Free Mortgage Pre-Qualifications same day on most applications. Email me at with your questions I specialize in Kentucky FHA, VA ,USDA, KHC, Conventional and Jumbo mortgage loans. I am based out of Louisville Kentucky. For the first time buyer with little money down, we offer Kentucky Housing or KHC loans with down payment assistance. Customer Testimonials 😍😍😍 We just moved here the first of January in 2017 from Ohio to the Louisville, KY area and we found Joel's website online. He was quick to respond to us and got back the same day on our loan approval. He was very knowledgeable about the local market and kept us up-to date throughout the loan process and was a pleasure to meet at closing. Would recommend his services. Angela Forsythe "We were searching online for mortgage companies in Louisville, Ky locally to deal with and found Joel's website, and it was a godsend. He was great to work with, and delivered on everything he said he would do. I ended up referring my co-worker at UPS, and she was very pleased with his service and rates too. Would definitely vouch for him." September 2016 Monica Leinhardt "We contacted Joel back in July 2011 to refinance our Mortgage and he was great to work with. We contacted several lenders locally and online, and most where taking almost 60 days to close a refinance, Joel got it done in 23 days start to finish,I would definetly recommmend him. He got us 3.75% with just $900 in closing costs on our FHA Streamline loan. 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Not only was he personable and easy to reach, he was extremely knowledgable in his field and made sure to find us the best rate and a top notch mortgage company. We were able to complete the process in less than 3 weeks with his expertise. I find Joel to have the utmost high integrity and I recommend him to anyone who say's they are need of mortgage assistance. He is also fantastic and keeping everyone up to date on the latest in the housing industry through his twitter posts. He provided great results for our family and we still communicate to this day!” August 21, 2010 Stacie Drake "We first use Joel on our new home purchase in 2007 in St Matthews, Kentucky area and he was great to work with. We have since refinanced our home with him in 2010 when rates got really low and he has always delivered on what he says. I could not imagine using anyone else." Melody Glasscock March 2014 Absolutely Amazing!! I emailed Joel after I had just got a denial from a bank and just thought i would try to get some advice on what my next steps would be to get a house. I honestly didn't expect to even get a reply because my credit is not great. That was about a week and a half ago. I just signed a contract on a house last night. ONLY because of Joel Lobb. He even worked with us throughout the weekend, which shocked me. Best decision I have ever made. THANK YOU SO MUCH FOR WORKING WITH US THROUGHOUT THE ENTIRE PROCESS. Cee Bellisle August 2017 Contacted him about buying a home and he was great to work with. I was moving to Louisville Ky to take a new job and he walked me through the entire process. He explained to me all the different options for FHA, VA, USDA mortgage loans and credit score requirements versus Fannie Mae. Since I was a first time home buyer I needed alot of help and guidance. I would definitely recommend him. Fast to respond and available to answer questions that I or my realtor had after hours. Anderson Johnson April 2018 Wow, what a great loan officer. I was referred to him by our agent and he was great to work with. We used him for a USDA no money down loan in Shelby County and we were really impressed. We were afraid we could not buy a home since we did not have money saved for a down payment, but Joe l was able to get us a zero down loan and we even got our appraisal fee and good faith deposit back at closing. We actually got money back at closing!!! I Can't think him enough. Our family moved from our apartment in the south end of town to get our own home with 5 acres for our kids and 2 dogs, at a payment that is equal to our rent payment also. .Thanks Again Joel. May god bless you Patty Locker We contacted Joel about buying a house on our move from Ohio for my husband's job transfer with Ford. We put a lot of trust in him since we were new to the area and first time home buyers in the Louisville KY market, and he always delivered on what he said. It took us a while to find a home due to the lack of homes, but once we got one, he was always quick to respond our questions via text or email ,and kept us informed through the process. We got to meet him at the closing and he was super nice and even got us a closing gift for our home which we didn't expect at all. Super nice guy 😀!!! I would definitely recommend him for a local Home loan in the Louisville area. pam dolby I got a VA loan with Joel and he was great. He is an ex-army guy so he could relate to my past experiences of being a veteran and moving around the country a lot. I had some credit issues that required a little extra work but Joel was able to find A VA lender to approve my situation as far as having past bad credit problems and a lower credit score. 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Joel Lobb Senior Loan Officer American Mortgage Solutions, Inc. 10602 Timberwood Circle Suite 3 Louisville, KY 40223 phone: (502) 905-3708 Fax: (502) 327-9119 Company ID #1364 | MB73346E This website is not an government agency, and does not officially represent the HUD, VA, USDA or FHA or any other government agency. Disclaimer: No statement on this site is a commitment to make a loan. Loans are subject to borrower qualifications, including income, property evaluation, sufficient equity in the home to meet Loan-to-Value requirements, and final credit approval. Approvals are subject to underwriting guidelines, interest rates, and program guidelines and are subject to change without notice based on applicant's eligibility and market conditions. NMLS#57916 . The content in this marketing advertisement has not been approved, reviewed, sponsored or endorsed by any department or government agency. Rates are subject to change and are subject to borrower(s) qualification.

11 thoughts on “Kentucky Rural Housing Service (RHS) program Mortgage”

    1. Annual Fee
      Effective with Conditional Commitments issued on and after October 1, 2011, all USDA loans will be subject to an annual fee in addition to the up-front guarantee fee.
      As announced in AN 4551, the annual fee will be .30% of the unpaid principal balance. The annual fee will be calculated and collected as follows:

      The initial fee, for the first year of the loan will be determined and calculated based on the loan amount. For remaining years of the loan, the annual fee will be charged on the scheduled amortized unpaid principal balance of the loan, not the actual UPB.

      The annual fee will be included as part of the borrower’s monthly PITI payment.
      Example: $100,000 Note loan amount x .30% = $300 / 12 = $25. $25 is the monthly payment.

      Plaza will establish an escrow account to collect the annual fee from the borrowers on a monthly basis. A collection of 2 months worth of annual fee payments at closing will apply, except where prohibited by state law.
      NOTE: The annual fee is a life of loan fee and will continue to be charged until the loan is paid in full.
      USDA has provided an Annual Fee Calculator that may be accessed at their Training Website:
      If you are using Excel 2003 version, you may also access the calculator here: USDA Guarantee Fee Calculator

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