Kentucky USDA Rural Development Loans

 

USDA-Loan-Apply-Today
USDA-Loan-Apply-Today

Frequently Asked Questions

Are only first-time homebuyers eligible?

No, you do not have to be a first time home buyer.  The USDA Loan program has no restrictions that prevent previous homeowners from using the program.


What is the maximum amount that I can borrow?

There isn’t a limit to the amount a homeowner can borrow


How much are the closing costs for a USDA mortgage?

Closing costs vary from lender to lender and state to state. The charges from the USDA are a Guarantee fee of 1% of the loan amount. Additionally, there is a monthly mortgage insurance factor of .35% of the principal balance.


Can closing costs be financed into a USDA Loan?

Yes! The USDA home loan has the ability to finance closing costs up to the appraised value or to get a 6% seller contribution to closing costs from sellers on the contract.

What are USDA eligibility requirements?

USDA requires that the borrower demonstrates a reasonable ability and willingness to repay the mortgage loan. USDA lenders will view your credit history, income, and assets to verify your ability to repay the mortgage.


What is the USDA’s minimum credit requirement?

The USDA has no minimum score required; however, most lenders require a minimum credit score of 640 or sometimes 620 to obtain financing. Exceptions can be made and you should talk to a loan specialist about this.


Can you qualify for a USDA loan if your credit score is below 640?

Many lenders do require a 640 minimum Fico score to be eligible for a USDA home loan, however, exceptions can be made. It is important to note that the derogatory credit is temporary in nature, beyond the applicant’s control, and the circumstances that caused the adverse credit are no longer a factor.


What does the USDA require for employment eligibility?

You must have established employment to be eligible for a USDA Loan. Almost all lenders will require a minimum of two years of steady employment or schooling prior to your current employment if less than 2 years. If you are self-employed, you are eligible but will be required to provide two years of federal tax returns to verify your income.


Do USDA home loans have PMI?

USDA mortgages do have a guarantee fee and monthly PMI. The rate for the mortgage insurance is .35% of the outstanding principal balance and the current guarantee fee is 1% of loan amount. For example, if you borrowed a full $150,000 from your lender, the guarantee fee would be $1,500, which you can finance into your mortgage. The monthly PMI would be about 44.00 dollars a month on a 151,500 loan amount. (which includes the guarantee fee of 1%)


Can I get a USDA Mortgage after bankruptcy?

Yes, the USDA Loan Program requires the bankruptcy to be discharged for at least 3 years for a CH 7 and at least 12 months of on time payments on a CH 13. You can be in a CH 13 currently as long as 12 months of on-time payments have been made and verified.


How soon can you qualify for a mortgage after foreclosure?

 VA Loans: 2 years after foreclosure
 USDA Loans: 3 years after foreclosure (Exceptions are possible!)
 FHA Loans: 3 years after foreclosure
 Conventional Loans (Fannie Mae and Freddie Mac): 7 years after foreclosure


Can I use a USDA Loan on investment property or Second Home?

No, the USDA Rural Housing Program is for primary residences only. Furthermore, any property that is income producing (farms, multi-family, over 30 acres, etc.) cannot qualify for the 502 Guaranteed Rural Home Loan.


Can a USDA loan finance a condominium?

Yes, you can use a USDA loan to finance a condo; however, there are requirements that will need to be met.


Does a USDA home loan finance modular or manufactured homes?

Modular and manufactured homes can be considered a USDA eligible property, but additional appraisal requirements will apply. Most lenders do not offer Section 502 USDA loans on manufactured homes; however, they do finance modular homes. The difference between a modular and manufactured is how and where the home is constructed. A manufactured home is already fully built and put on a foundation and modular homes are built in pieces, and then taken to the site to be constructed.


How fast can you close a USDA loan?

USDA loans have a 2 prong process. The loan is first approved by the lender and then sent to the local USDA field office to be insured. Depending on the turn-times at the local USDA office, closing can be as fast as 20 days or up to 60 days.

 

Kentucky USDA Rural Development Loans

  • Looking for 100% Financing without the Military Service Requirement?
  • Tired of Sourcing Funds for a Down Payment?
  • Need a New Product Niche Designed Specifically for Purchases?

100% Financing – If your borrower wants low down payment options, Kentucky USDA Rural Housing is the only widely available zero-down loan (other than VA which includes military service requirements).  Plus – reduced MI and no cash reserve requirements! *

Not a Farm Loan – It takes just a few minutes to check property eligibility – moving to a farm isn’t required – in fact, many suburban and rural parts of the country are eligible. Visit the USDA Mapping Tool Site (for residential properties only).

Program Minimum Down
Payment
Conventional 3%
FHA 3.5%
USDA 0%
VA 0%
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Kentucky USDA Mortgage Lender for Rural Housing Loans

unnamed (12)

Joel Lobb (NMLS#57916)
Senior  Loan Officer
 
American Mortgage Solutions, Inc.
10602 Timberwood Circle Suite 3
Louisville, KY 40223
Company ID #1364 | MB73346
 


Text/call 502-905-3708
kentuckyloan@gmail.com

http://www.nmlsconsumeraccess.org/

If you are an individual with disabilities who needs accommodation, or you are having difficulty using our website to apply for a loan, please contact us at 502-905-3708.

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. Refinancing an existing loan may result in total finance charges being higher over the life of a loan. Reduction in payments may reflect a longer loan term. Terms of any loan may be subject to payment of points and fees by the applicant  Equal Opportunity Lender. NMLS#57916http://www.nmlsconsumeraccess.org/

List of Kentucky USDA Single Family Housing For Sale

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KENTUCKY USDA RURAL HOUSING PROPERTY STANDARDS FOR THE GUARANTEED HOME LOAN PROGRAM

Kentucky based USDA Mortgage Lender
Kentucky based USDA Mortgage Lender

 

Sites must be modest and developed in accordance with any standards imposed by a State or local government. Therefore, the lender must verify that the following requirements are met at the time of application.

  •  Site size The site size must be typical for the area.  (Some acreage is fine as long as it is normal and the appraisal has comparable sales with similar acreage)

 

  • Income-Producing Buildings. The property must not include buildings designed and to be used principally for income-producing purposes. For example barns, silos, greenhouses, or livestock facilities used primarily for income producing agricultural, farming or commercial enterprise are ineligible. However, barn, silos, livestock facilities or greenhouses no longer in use for a commercial operation, used for storage, and outbuildings such as storage sheds are permitted if they are not used primarily for income producing agricultural, farming or commercial enterprise. A minimal income-producing activity, such as maintaining a garden that generates a small amount of additional income, does not violate this requirement. Home-based operations such as childcare, product sales, or craft production that do not require specific features are not restricted.  A qualified property must be predominantly residential in use, character and appearance.

 

  • Income-Producing Land. The site must not have income-producing land that will be used principally for income producing purposes. Vacant land or properties used primarily for agricultural, farming or commercial enterprise are ineligible. Sites that have income-producing characteristics (e.g. large tracts of arable land ready for planting) are considered income-producing property.  However maintaining a garden for personal use is not in violation of this requirement. A minimal income-producing activity, such as a garden that could generate a small amount of additional income does not violate this requirement. A qualified property must be predominantly residential in use, character and appearance.
  • Site Specifications. The site must be contiguous to and have direct access from a street, road, or driveway. Streets and roads must be hard surfaced or all weather surfaced and legally enforceable arrangements must be in place to ensure that needed maintenance will be provided.
  • Utilities. The site must be supported by adequate utilities and water and wastewater disposal systems.

 

 

Kentucky based USDA Mortgage Lender
Kentucky based USDA Mortgage Lender

 

DIFFERENCES BETWEEN THE SECTION 502 GUARANTEED AND DIRECT LOAN PROGRAMS

 

There are several other Section 502 loan programs, but the only one that approaches the guaranteed program in number of loans made is the Homeownership Direct Loan Program

This program once accounted for almost all the Section 502 loans, but the number of guaranteed loans has greatly increased in the last few years. In Fiscal Year 2001, the guaranteed program obligated approximately $2.3
billion for 29,326 loans, while the direct program obligated approximately $1.07 billion for a total of 14,789 loans. The important differences between the Section 502 guaranteed and direct loan programs are as follows:

ƒ The lender for Section 502 guaranteed loans is a private savings and loan institution, bank, or mortgage company which also handles all the loan servicing. The lender for the direct program is the Rural Housing Service; Rural Development handles the servicing.

ƒ Income levels for Section 502 guaranteed borrowers are capped at 115 percent of the area median income. Income levels for the direct program must be no more than 80 percent of the AMI. ƒ Payment assistance subsidy is not available 
through the guaranteed program. Payment assistance, which can reduce the interest paid on the mortgage to as low as 1 percent, is available for borrowers in the direct program and is based on the borrower’s income as a percent of AMI.
ƒ Borrower protections differ between the programs. Applicants for guaranteed loans do not have the rights of moratorium or of appeal that accompany the direct program. Also, in the case of default, Section 502 guaranteed loans are liquidated by
the commercial lender, while direct loans are liquidated by the government

 

 

click here for your free quote to start your home journey

Kentucky Mortgage USDA Loans Zero Down Home Loans Still Exist

 

 

Kentucky Mortgage Usda Loan Zero Down Home Loans Still Exist



Your income and your monthly expenses. Standard debt-to-income ratios are 29/41 for USDA Loans. These ratios may be exceeded with compensation factors.

Your credit history (this is important, but USDAs credit standards are flexible). A FICO score of 620 or above is required for all loans

Your overall pattern rather than to individual problems you may have had.

To be eligible for an USDA mortgage, your monthly housing costs (mortgage principal and interest, property taxes and insurance) must meet a specified percentage of your gross monthly income (29% ratio). Your credit background will be fairly considered. At least a 620 FICO credit score is required to obtain an USDA approval through Lending. You must also have enough income to pay your housing costs plus all additional monthly debt (41% ratio). These percentages may be exceeded with compensating factors. Applicants for loans may have an income of up to 115% of the median income for the area. Maximum USDA Loan income limits for your area can be found at here. Families must be without adequate housing, but be able to afford the mortgage payments, including taxes and insurance.



Can I get an USDA Mortgage Loan after bankruptcy?

Criteria for USDA loan approvals state that if you have been discharged from a Chapter 7 bankruptcy for three years or more, you are eligible to apply for an USDA mortgage. If you are in a Chapter 13 bankruptcy and have made all court approved payments on time and as agreed for at least one year, you are also eligible to make an Kentucky USDA loan application.



What are the USDA Down Payment Requirements?

USDA Mortgages have no down payment requirement. 


What is the maximum amount that I can borrow?

The maximum amount for an Kentucky USDA Mortgage Loans are determined by:



Maximum loan amount: The is no set maximum loan amount allowed for an USDA Mortgage. Instead, your debt-to-income ratios will dictate how much home your can afford (29/41 ratios). Additionally, your total household monthly income must be within USDA allowed maximum income limits for your area. Maximum USDA Loan income limits for your area can be found at here.



Maximum financing: The maximum USDA Mortgage amount will be 100% of the appraised value of the home.



What kinds of loans does USDA offer?


Fixed rate loans – All USDA loans are fixed-rate mortgages. In a fixed rate mortgage, your interest rate stays the same during the whole loan period, normally 30 years. The advantage of a fixed-rate mortgage is that you always know exactly how much your monthly payment will be, and you can plan for it.


What is Considered a Rural Area by the USDA?

Rural areas include open country and places with population of 10,000 or less andunder certain conditionstowns and cities. There is an automated rural area eligibility calculator at:http://eligibility.sc.egov.usda.gov.


Kentucky USDA Loans

What are USDA Home Loans?

USDA stands for United States Department of Agriculture. A USDA Mortgage provides a low-cost insured home mortgage loan that suits a variety of options. A USDA mortgage is likely the best home loan option if you want to purchase a home with no down payment. If youre unsure about your credit rating, or have concerns about a down payment when youre doing a home loan comparison, ENG Lendings USDA Rural Mortgage Loans can give you piece of mind with zero-down, super low closing costs and no monthly mortgage insurance.


What Types of Loans does USDA offer in Kentucky?

Currently, there are two kinds of USDA Home Loans available in Kentucky for single family households:


USDA Guaranteed Rural Housing Loans

USDA Guaranteed Home Mortgage Loans are the most common type of USDA Loanin Kentucky and allow for higher income limits and 100% financing for home purchases. USDA Guaranteed Loan applicants may have an income of up to 115% of the median household income for the area. Area income limits for this program can be viewed here. All USDA Guaranteed Loans carry 30 year terms and are set at a fixed rate.


USDA Direct Rural Housing Loans

USDA Direct Housing Loans are less common than USDA Guaranteed Loans and are only available for low and very low income households to obtain homeownership, as defined by the USDA. Very low income is defined as below 50 percent of the area median income (AMI); low income is between 50 and 80 percent of AMI; moderate income is 80 to 100 percent of AMI. Click here to see area income limits for this program.

What factors determine if I am eligible for a USDA Loan in Kentucky?

To be eligible for A USDA Rural Loan in Kentucky, your monthly housing costs (mortgage principal and interest, property taxes, and insurance) must meet a specified percentage of your gross monthly income (29% ratio). Your credit background will be fairly considered. A 620 FICO credit score is required to obtain a USDA Rural Housing Loan approval through ENG Lending. You must also have enough income to pay your housing costs plus all additional monthly debt (41% ratio). These ratios can be exceeded somewhat with compensating factors. Applicants for loans may have an income of up to 115% of the median income for the area. Maximum USDA Guaranteed Loan income limits for your area can be found at here. Maximum USDA Direct Loan income limits for your area can be found at here. Families must be without adequate housing, but be able to afford the mortgage payments, including taxes and insurance.


What is the maximum amount that I can borrow?

The maximum amount for an USDA home loan is determined by:

Maximum Loan Amount: The is no set maximum loan amount allowed for USDA Rural Home Loans. Instead, your debt-to-income ratios will dictate how much home your can afford (29/41 ratios). Additionally, your total household monthly income must be within USDA allowed maximum income limits for your area. Maximum USDA Guaranteed Loan income limits for your area can be found at here.


Maximum financing: The maximum USDA Rural Development Loan amount is 102% of the appraised value of the home (100% plus the 2% USDA RD Loan guarantee fee).

Kentucky Mortgage Usda Loan Zero Down Home Loans Still Exist



How much money will I need for the down payment and closing costs?

USDA Rural Development Mortgage Loans require no down payment and they allow for the closing costs to be included in the loan amount (appraisal permitting).



What property types are allowed for USDA Rural Loan Mortgages?

While USDA Mortgage Guidelines do require that the property be Owner Occupied (OO), they do allow you to purchase condos, planned unit developments, manufactured homes, and single family residences.

Additional offers from other lenders.



Kentucky USDA Loan Adjusted Maximum Income Limits by County

everything You Need To Know About USDA-Rural Home Loans



I have put together valuable information and tools to help you gather all of the information that you need to make the most informed decision when shopping for a mortgage. Sometimes the USDA Home Loan Program is not the best option for a Zero Down Purchase. .


Sometimes good credit and a down payment are not enough to qualify for a home loan at a commercial lending institution, such as a bank, savings and loan or with a mortgage broker. That is why the U.S. Department of Housing and Urban Development has provided a loan program that allows more rural families and individuals to be eligible to become homeowners with the help of a USDA guaranteed home loan. The USDA loan program allows:

– 620 min credit score

– Up to 6% seller contributions

– No PMI (private mortgage insurance)

– Zero Down


However, the USDA-RD loan program DOES have 2 main qualifying features:

(1) Eligibility is region or location specific CLICK HERE http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=sfp&NavKey=property@11 to check if an address is USDA Eligible.

(2) Eligibility is income specific. Qualifying income is based on household members and a max income cap. CLICK HERE http://eligibility.sc.egov.usda.gov/eligibility/incomeEligibilityAction.do?pageAction=state&NavKey=income@11 to see if you qualify under the max income cap.

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