I am a Kentucky based USDA Mortgage Lender that has originated over 300 KY Rural Housing Mortgage Loans in Kentucky-CALL OR TEXT 502-905-3708 FOR USDA MORTGAGE LOAN
Beginning on September 23rd, 2019, the way USDA calculates student loans in regards to Student Loans and they effect loan approvals.
Kentucky Rural Housing loan Changes for Student Loans
Effective immediately for all Kentucky Rural Development loans, student loan calculations will be changed to the following
Fixed Payment Loans:A permanent amortized, fixed payment may be used when it can be documented that the payment is fixed, the interest rate is fixed, and the repayment term is fixed.
Non-Fixed Payment Loans (i.e. deferred, income based, graduated, adjustable, etc.): The payment should be calculated as the greater of 0.5% of the loan balance or the actual payment reflected on the credit report. No additional documentation is required.
RHS temporarily modified the calculation of non-fixed student loan payments for purposes of determining debt-to-income ratios. Per the modified requirements, lenders must now use the higher of .50% of the loan balance or the actual payment reflected on the credit report as the monthly payment (rather than 1% of the loan balance). The modified requirements went into effect September 23, 2019 and will be permanently incorporated into Chapter 11 of the Single Family Housing Loan Program Technical Handbook (HB-1-3555) in the near future.
BIG change announced for Kentucky Rural Housing USDA loans today regarding how minimum payments on your Student Loans are calculated. Reach out to see if you qualify for this awesome loan!
Have you or someone you know been turned down for a USDA loan recently because of student loans?
New guidelines effective today may allow you to qualify (or qualify for a little higher loan amount)
**This is not an offer for extension of credit or a commitment to lend. All loans must satisfy company underwriting guidelines. Information and pricing are subject to change at any time and without notice. Not all applicants will qualify for all loan products offered. This is not an offer to enter into a rate lock agreement under any applicable law. Not endorsed or part of USDA Federal Government Agency.
Section 504 Repair Loan and Grant Program for Kentucky USDA RHS Loans
If you missed the live webinar to learn about recent changes to the Section 504 Single-Family Housing Repair Loan and Grant Program, the presentation slides from the webinar are available on the U.S. Department of Agriculture (USDA) Rural Development’s website. This information is for individuals and organizations, including nonprofits and public agencies, who work with affordable housing products such as weatherization, home repairs, and Section 504 application packaging.
The slides will provide information on the following:
An overview of recent changes to the Section 504 Single-Family Housing Repair Loan and Grant Program.
For a brief overview of the 504 program, please watch the USDA Helps You Make Home Repairs
Program Guidelines & Terms –Section 504 Loans
• Maximum outstanding 504 loan amount is $20,000
• Interest rate is fixed at 1%
• Maximum term of 20 years (term and payment is based upon the
family budget)
• Appraisal and escrow account is required for loans over $15,000
• Flood insurance is required for properties located in a flood zone
• Mortgage, title work and closing agent required for loans of
$7,500 or more
• Mortgage is filed for loans of $7,500 and over
• Assets above $15,000 ($20,000 for elderly/disabled households)
must be applied toward repairs.
• Residential Mortgage Credit Reports are ordered by Agency for
loans of $7,500 and over (RMCR fee paid by Rural Development
General Eligibility Criteria – Section 504 Loans
• Household income must not exceed “very low” income
limits; < 50% HUD median income
• Applicant must own home (to include site when
considering manufactured housing) and occupy house on a
permanent basis
• Demonstrate repayment ability based upon a family budget
• Stable and dependable source of income
• Acceptable credit – reasonable ability and willingness to
meet debt obligations
• Meet asset limitations (15K non-elderly and $20K elderly*)
Program Guidelines & Terms –Section 504 Grant
• Maximum cumulative lifetime grant assistance is $7,500
• Grantee must sign Grant Agreement requiring occupancy
of home for 3 years
• No lien on property
• Repairs to remove health and safety hazards or to make the
home accessible and useable for household members with
disabilities.
General Eligibility Criteria – Section 504 Grants
• At least one applicant must be 62 years of age or older.
• Household income must not exceed “very low” income limits;
< 50% HUD median income
• Applicant must own home (to include site when considering
manufactured housing) and occupy house on a permanent basis
• Repairs must be necessary to remove health and safety hazards or
to make the home accessible and useable for household members
with disabilities.
• Must demonstrate a lack of repayment ability based upon a
household budget.
• Meet asset limitations (15K non-elderly and $20K elderly*)
• No outstanding federal judgments
SECTION 504 PROPERTY REQUIREMENTS
• Must be modest for the area; market value cannot be in
excess of USDA established area loan limit
• Property must be located in a designated rural area
• Must not have an in-ground swimming pool
• If the property has income producing land or structures, we
may use loan/grant funds as long as repairs are used for the
residential portion of the home.
• Mobile or manufactured homes must be on a permanent
foundation or be placed on a permanent foundation with
loan or grant funds.
For additional program Information, please visit the following USDA webpages:
What are Kentucky USDA Home Loans? Do I Qualify? Deciding between rural and suburban is one of many choices you’ll make along your homeownership journey. And if the countryside is your preference, then you may want to consider applying for a USDA loan. You’…
If you are looking to buy a home in Northern Kentucky, to either own a home on acreage in the country with 100% financing on your home loan with zero down, then you need to look at the Kentucky USDA Rural Housing Loan Program.
How Does the USDA Home Loan Work in Northern Kentucky?
Here are some of the Key Financial Elements of the USDA Home Loan in Northern Kentucky:
Low to Middle-Income Households are generally eligible – If the Household Income is too high, you may be ineligible.
30 Year Fixed Term Loans at Today’s Low Interest Rates compared to FHA, USDA and other government mortgage loans
Qualifying rations are 29% for Housing and 41% for total debt. or possibly higher with a credit score over 640.
Rural Development Loan Guarantee Fee applies, currently 1% USDA funding fee and .35% monthly mi premium
Zero Cash required for the Down Payment. If access to 20% down payment, then you cannot use this program.
Flexible Credit Guidelines, where non-traditional histories may be accepted. USDA will do a no score loan, but it is very difficult to qualify for so your best bet is to get your credit scores to 620 to 640 range and go from there. You will need two trade lines on the credit report for last 12 months, so no limited credit history is allowed on this program.
Eligible properties include: Existing Homes, New Construction, New Manufactured Homes, Modular Homes, and eligible Condos!—No used mobile homes.
Eligible Repairs may be included in the loan as well! If home appraises for more than sales price, sometimes you can finance these repairs into the loan.
They’re are two income tests. Compliance income and repayment income. See pic below for answers about Northern Kentucky Counties with max income limits for household
Home must be in an eligible area. See map below of Northern Kentucky Eligibility for USDA Rural Housing Loans
What Parts of Northern Kentucky Are Eligible for the USDA Home Loan?
With Northern Kentucky being part of the metro area of Cincinnati, the USDA has provided a map of the Ineligible Northern part of the Counties of Boone, Kenton, Campbell counties which means, the remaining southern part of the counties of Boone, Kenton, Campbell being eligible. Here is the Northern Kentucky rural housing map courtesy of the USDA:
What Parts of Northern Kentucky Are Eligible for the USDA Home Loan?
What are the income limits for a Rural Housing Loan in Northern Kentucky?
Households with 1-4 members have different limits as households with 5-8. Similarly, applicants living in high-cost counties will have a higher income limit than those living in counties with a more average cost of living.
Here are a few more items to check off before looking into this loan or at a particular property:
Must be Owner Occupied as the Primary Residence;
Home must not be used to produce Income, nor can there be Income Producing Buildings or other Accessories that produce Income on the property; i.e. no working farms or cows, livestock, crops etc. Can be a small hobby farm.
No foreclosed homes that that need a lot of work.
Home must be structurally sound and in reasonably good repair and pass FHA standards on an appraisal.
Home cannot be used for a Rental Property or, be a major fixer
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
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/
— Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. This is not a commitment to lend. Programs, rates, terms and conditions are subject to change without notice. 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.
A borrower who has no verifiable employment for 6 months or longer is deemed to have a gap in employment.
Any gaps in employment must be analyzed in order to make a final determination of stable and dependable income. An employment gap does not automatically render an applicant ineligible. Applicants with job gaps due to maternity leave, medical leave, relocation, etc. are considered to have employment continuity. Applicants returning to the workforce after leaving a previous job to care for a child/family member, complete education, etc. will require a 12 month employment history.
Kentucky USDA Mortgage Lender for Rural Housing Loans 