Tag: Down payment

Kentucky Rural Development Kentucky Guaranteed Housing Zero Down


Kentucky Rural Development Kentucky Guaranteed Housing Zero Down.

via Kentucky Rural Development Kentucky Guaranteed Housing Zero Down.

Louisville Kentucky mortgage rates


Louisville Kentucky mortgage�rates.

via Louisville Kentucky mortgage rates.

The Best Kind of Loan for Your Credit Score


The Best Kind of Loan for Your Credit Score.

via The Best Kind of Loan for Your Credit Score.

DEFERRED STUDENT LOANS AND DEBT RATIO CALCULATIONS Kentucky Rural Housing Loans and USDA Loans in KY


DEFERRED STUDENT LOANS AND DEBT RATIO CALCULATIONS  for Kentucky Rural Housing Loans and USDA Loans in KY

 

RHS Student Loan DTIs

 

Due to the variable nature of some student loan plans, RHS is standardizing the process of including them in the debt ratio. All student loans will now require documentation verifying the current payment due.

 

For student loans which are Conventional, Fixed Payment, and/or Deferred:

  • Account statements will be reviewed and fixed monthly payment will be used with no adjustments.
  • Deferred student loans not in repayment will use an estimated payment of 1% of the loan balance unless a documented fixed payment from the loan servicer can be provided.

 

For student loans with Income Based Repayment plans:

  • If the current payment is greater than $100, that payment can be used.
  • If the current payment is less than $100 and total loan balance is greater than $10,000, a minimum $100 payment must be included in the debt ratio.
  • If the current payment is less than $100 and total loan balance is less than $10,000, then the current payment may be used

 

Please note that documentation of an Income Based Repayment agreement must be provided. Payments of $0 are not eligible to be used in the debt ratio. Verifications are only valid for 120 days, 180 days for new constructions

 

DEFERRED STUDENT LOANS AND DEBT RATIO CALCULATIONS

. A 100% 30 year fixed interest rate loan with flexible credit and qualifying ratios along with other benefits, will open the door to a new market and new growth possibilities.

We look forward to a long and productive relationship this affordable housing product to the people of Kentucky and to a strong partnership in the Kentucky GRH Program.

For the USDA Rural Development Single Family Housing Guaranteed Loan Program, deferred student loans should be included in the debt ratio calculations for Guaranteed Loans regardless of the deferment period.

Rural Development RD Instruction 1980-D, section 1980.345(c)(1) states:

“Long term obligations include those obligations . . . with a remaining repayment period of more than 6 months and other shorter term debts that are considered to have a significant impact on repayment ability.”

Deferred student loans are long term obligations with remaining repayment periods of more than 6 months, and they must be included as part of the

applicant‟s recurring monthly debt obligations. If the credit report does not reflect a monthly payment due at the end of the deferment period, the lender may request a copy of the applicant‟s payment letter, or utilize the industry standard of estimating student loan payments as 1% of the loan balance. Therefore a deferred student loan balance of $12,000 should have a corresponding monthly payment of $120 if no estimated payment is verified by the lender.

This guidance applies to all manually

DEFERRED STUDENT LOANS AND DEBT RATIO CALCULATIONS Kentucky Rural Housing Loans and USDA Loans in KY

Related Articles

KENTUCKY RURAL DEVELOPMENT QUICK REFERENCE GUIDE


Logo of the USDA Rural Development office, par...
Logo of the USDA Rural Development office, part of the Department of Agriculture. (Photo credit: Wikipedia)

KENTUCKY RURAL DEVELOPMENT QUICK REFERENCE GUIDE

100% * NO MONEY DOWN LOAN and LOW  “MI” * Seller Can Pay All CC’s
GENERAL INFO
• 29% PITI, 41% TD ratios
• (waivers allowed with good credit)
• Debts with 6 months or more owed will be
counted
• Property must be located in eligible RD areas
• Land value cannot exceed 30% of total value
• In-ground swimming pools may be approved with
waiver
• No substandard homes
• No existing manufactured homes
• CAIVRS number(s) needed
ELIGIBILITY
• First time homebuyer not a requirement
• Income must be within RD limits
• Income must be adequate and stable
• Adequate ability to repay the loan
• Acceptable credit history
• Be without an adequate dwelling
• Cannot obtain conventional financing
• Citizen or permanent resident alien
• Owner occupied
• Legal capacity to incur debt
• Bankruptcy OK if discharged for 36 months
INCOME ELIGIBILITY
• All household income counted
• Overtime, bonuses, and commissions count, if
supported by history
• Child support counts –may be grossed up 25%
• Self-employment – (use IRS net income) – 2 year
history plus current information needed
• Same job or line of work for past 12 months
(some exceptions allowed)
• Written verification of SS, SSI, etc.
• Degree or certification can substitute for job time
• All income must be verified
GROSS INCOME DEDUCTIONS/ADJUSTMENTS
• $480 for each child under 18
• Over 18 counts if full time student living at home
• Actual child care expenses for children 12 or
younger if parents work or attend school
• $400 for applicant or co-applicant if disabled or
elderly
• Medical deductions may be considered for
disabled or elderly applicants (above 3% of gross
income
KEY POINTS
• No Down Payment
• 100% Guaranteed financing
•  LOW  MONTHLY “MI”  of .40 basis points . Much lower than FHA which is 1.25% basis points. —Almost $100 cheaper on Kentucky RHS loan vs FHA loan, plus no 3.5% down payment needed like FHA requires.
• Terms—30 year fixed
• Guarantee fee of 2% of loan amount
• Refinance Fee 2.0 % of loan amount
• Appraised values can be exceeded by amount of
guarantee fee—up to 102% LTV
• Streamlined credit documentation with FICO of
640 or higher
• Unlimited Gifts or Seller Contributions
• Down-payments accepted up to 19%
• Guarantee Fee is fully Tax Deductible in the year
it is paid
• No Loan Limit (Ratio Determined)
• Partner with other Funding Sources
• AUS System – GUS – Being Developed
• Regular Program updates
• Monthly Newsletter by email
EXISTING DWELLINGS
• Satisfactory appraisal
• Thermal certification NOT required
• Well test
• Septic system certification
• Termite letter
NEW CONSTRUCTION
• Satisfactory appraisal
• Thermal certification
• Plan certification
• One year warranty on footings, framing, and final
inspection
• Termite Soil Treatment Certificate
• Well test
LOAN PURPOSES
• Purchase New
– Stick or Modular
– Manufactured (from approved dealer)
• Purchase Existing
• Stick or Modular
• Repairs/Rehab
• Refinance
• RD Direct Loans
• RD Guaranteed Loan
• Typical Loan Closing Costs
USDA Rural Development

RD PROGRAM – WEBSITES

Eligibility Website:
http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do

http://www.rurdev.usda.gov/rhs/sfh/sfh%20guaranteed%20loan%20in
come%20limits.htm

KY “MAPS”: http://www.rurdev.usda.gov/ky/maps.htm
http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do

Related Articles