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

FHA’s New Student Loan Rule Could Impact Mortgage Borrowers


Student Loan Payment Calculations

Fannie
If a monthly payment is on the credit report, the lender may use that amount for qualifying purposes.
If a monthly payment is on the credit report is incorrect, the lender may use the monthly payment on the most recent student loan statement
If the monthly payment on the credit report is zero, the lender must use one of the following options to calculate the payment for qualifying purposes
Document the borrower is on an income driven payment plan and the actual monthly payment is zero
Use 1% of the outstanding student loan balance as the monthly payment
Calculate a fully amortized payment using documented loan repayment terms

FHA
Regardless of the payment status (currently in payment or deferred), the lender must use either:
The greater of:
1% of the outstanding balance; or
The monthly payment reported on the credit; or
Calculate a fully amortized payment using documented loan repayment terms

RHS
Regardless of the payment amount reporting on the credit, the lender must include the payment as follows:
A permanent amortized, fixed payment may be used in the debt ratio when the lender retains documentation to verify the payment is fixed, the interest rate is fixed, and the repayment term is fixed.
Payments for deferred loans, Income Based Repayment (IBR), Graduated, Adjustable, and other types of repayment agreements which are not fixed cannot be used in the total debt ratio calculation. One percent of the loan balance reflected on the credit report must be used as the monthly payment. No additional documentation is required.

VA
If the borrower can document the student loan will be deferred 12 months from the closing date, the monthly payment does not need to be considered
If a student loan is in repayment or scheduled to begin repayment within 12 months from the closing date, the threshold payment amount must be calculated by using 5% of the loan balance divided by 12 months
If the payment reporting on the credit report is greater than the threshold payment calculation amount, then the credit report payment must be used for ratios.
If the payment reporting on the credit report is less than the threshold payment calculation and the lender is using the lower payment to qualify the borrower then:
A statement from the student loan servicer reflecting the actual loan terms and payment information must be included in the file.
The statement must be dated within 60 days of closing
It is the underwriter’s discretion to use the lower payment

Kentucky Mortgage Broker Offering FHA, VA, USDA, Conventional, and KHC Down Payment Assistance Home Loans's avatarLouisville Kentucky Mortgage Loans

via FHA’s New Student Loan Rule Could Impact Mortgage Borrowers

Student Loan Payment Calculations
Fannie
  • If a monthly payment is on the credit report, the lender may use that amount for qualifying purposes.
  • If a monthly payment is on the credit report is incorrect, the lender may use the monthly payment on the most recent student loan statement
  • If the monthly payment on the credit report is zero, the lender must use one of the following options to calculate the payment for qualifying purposes
  1. Document the borrower is on an income driven payment plan and the actual monthly payment is zero
  2.  Use 1% of the outstanding student loan balance as the monthly payment
  3. Calculate a fully amortized payment using documented loan repayment terms
FHA
Regardless of the payment status (currently in payment or deferred), the lender must use either:
  • The greater of:
  1. 1% of the outstanding balance; or
  2. The monthly…

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Kentucky Rural Development Loans 100% Financing.


USDA Loans in Kentucky. Updated Qualifying Guidelines 

What is Kentucky  USDA Rural Development Guarantee?

Kentucky USDA Rural Development Guarantee USDA loans offer 100% financing options on home purchases in rural areas of Kentucky.  Properties though can be located within city limits and in subdivisions depending on the population density of that particular County of Kentucky. Jefferson and Fayette Counties, the two largest counties of Kentucky are not eligible for Rural Development Loans.

Full Credit Guidelines below ….click on link for USDA Mortgage Credit Guidelines

👇

https://www.rd.usda.gov/files/RD-SFH-CreditNotes.pdf

Some highlights of the KY Rural Housing loan program are:

  • 100% financing on purchases with no down payment
  • Low 30 year fixed rates. No prepayment penalty.
  •  Rural Housing monthly guarantee fee of .35%
  • Upfront Rural Housing funding fee of 1% of the loan amount and is financed into new loan
  • No  Minimum credit scores but helpful to have 620 or higher with most USDA lenders with a 640 and get an automated underwriting approval thru Rural Housing’s underwriting engine – GUS-GUS Stands for the automated Underwriting system they use online to pre-approve you for a loan.
  • Each lender will set their own credit and debt to income criteria
  • No rental verification needed with GUS approval
  • No foreclosures in the last 36 months, 
  • A bankruptcy discharged at least 36 months

For a USDA eligible areas in Kentucky, see the property and income eligibility search, please click HERE.

Things to look for in your  Rural Housing property search in Kentucky below:

  • Avoid homes in flood zones – RD is very restrictive for homes in flood zones. They will do them in flood zones just watch out for the costly premiums.
  • Avoid homes with cisterns – they are extremely difficult to get financed
  • Be aware that homes with wells and septic systems needed extra tests for contamination
  • Avoid homes with any income-producing activities such as working farms, detached buildings with offices or car lifts for auto repairs, or anything else related to income-producing activities.
  • Manufactured homes or doublewides must be brand new. No used mobile homes are allowed.
  • Must meet FHA standards on appraisals so watch out for this on older homes with crawl spaces. 
  • Must have a permanent heat source and no wood stoves as permanent heat sources
  • Homes that are in need of major repairs.

Put my experience of originating KY USDA loans to work for you. I have successfully originated over 200 Rural Housing Mortgage Loans in Kentucky. I offer free pre-approvals and will help you from start to finish and I usually attend all my closings in Kentucky. 

Get Qualified for a Kentucky USDA Loan Now!

Joel Lobb
Mortgage Loan Officer
Individual NMLS ID #57916
 
American Mortgage Solutions, Inc.

Text/call:      502-905-370

fax:            502-327-9119
email:          kentuckyloan@gmail.com
 

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). Mortgage loans only offered in Kentucky.

All loans and lines are subject to credit approval, verification, and collateral evaluation and are originated by lender. Products and interest rates are subject to change without notice. Manufactured and mobile homes are not eligible as collateral.



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Mortgage Rates Drop for Fourth Straight Week for Kentucky Mortgage Loans 


Kentucky Mortgages Rates for FHA, VA, USDA, Conventional, Jumbo Mortgage Loans

Kentucky Mortgage Broker Offering FHA, VA, USDA, Conventional, and KHC Down Payment Assistance Home Loans's avatarLouisville Kentucky Mortgage Loans

Kentucky Mortgages Rates for FHA, VA, USDA, Conventional, Jumbo Mortgage Loans Kentucky Mortgages Rates for FHA, VA, USDA, Conventional, Jumbo Mortgage Loans

via Mortgage Rates Drop for Fourth Straight Week for Kentucky Mortgage Loans 

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How are collections treated on a Mortgage loan in Kentucky for a FHA and Conventional Loan Approval?


Collection Account Tips for Fannie Mae and FHA Loan in Kentucky. Do they have to be paid to get approved for a Kentucky Mortgage Loan?

Kentucky Mortgage Broker Offering FHA, VA, USDA, Conventional, and KHC Down Payment Assistance Home Loans's avatarLouisville Kentucky Mortgage Loans

via How are collections treated on a Mortgage loan in Kentucky for a FHA and Conventional Loan Approval?

Collection agency, Collections Accounts, collections fha loan, Credit and Collection, credit report, Credit Scores, fha collections, fha loan 

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Income Requirements for A Kentucky Rural Housing Loan Approval.


Kentucky Rural Housing USDA Guidelines 2011, Kentucky USDA Loan Adjusted Maximum Income Limits by County, Kentucky USDA Loans, Kentucky USDA/Rural Housing Areas, QUICK GUIDE for Kentucky USDA Rural Development Housing Loan, rhs, rhs loans kentucky, Rural Deveoplment, rural housing, Rural Housing Loans No Money Down Program, usda, USDA No money down mortgage Louisville Kentucky Kentucky housing corp 30 year fixed

Kentucky Mortgage Broker Offering FHA, VA, USDA, Conventional, and KHC Down Payment Assistance Home Loans's avatarKentucky First-Time Home Buyer Programs | USDA, FHA, VA & KHC Loans

Income Requirements for A Kentucky Rural Housing Loan Approval..

via Income Requirements for A Kentucky Rural Housing Loan Approval..

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