Tag: Elizabethtown Kentucky

How to Qualify for a USDA Home Loan in Kentucky


 

The Kentucky Rural Housing  USDA home loan program offers an excellent opportunity for eligible homebuyers in rural and suburban areas of Kentucky to secure affordable financing with no down payment. To qualify, applicants must meet specific requirements related to credit score, income, work history, bankruptcy, foreclosure, debt-to-income ratio, property requirements, and mortgage insurance. Here’s a detailed guide to help you understand these qualifications:

Credit Score Required For Kentucky Rural Housing Approval

A minimum credit score of 640 is generally required to qualify for a USDA loan. This score allows for streamlined processing through the Guaranteed Underwriting System (GUS). Applicants with scores below 640 may still qualify but will need to undergo manual underwriting, which requires additional documentation and scrutiny.

Income Requirements for Kentucky USDA Rural Housing Approval

USDA loans have income limits that vary by county and household size. These limits are designed to ensure the program assists low- to moderate-income families. Generally, your household income should not exceed 115% of the median income for your area. The USDA provides an online tool to check income eligibility based on your location and household size.

Work History requirements for Kentucky USDA loan Approval 

A stable work history is essential for Kentucky  USDA loan approval. Lenders typically look for at least two years of consistent employment. Any gaps in employment need to be explained and documented. For self-employed applicants, a minimum of two years of tax returns is required to verify income stability.

Kentucky USDA Rural Housing Bankruptcy and Foreclosure Guidelines

While past financial difficulties like bankruptcy or foreclosure can affect your eligibility, they do not automatically disqualify you. Here are the typical waiting periods:

  • Chapter 7 Bankruptcy: At least three years from the discharge date.
  • Chapter 13 Bankruptcy: At least one year of the payout period must be completed with satisfactory payment history and court approval for a new loan.
  • Foreclosure: At least three years from the completion date.

Kentucky USDA Debt-to-Income Ratio (DTI) Requirements

The Kentucky USDA loan program has specific DTI requirements to ensure borrowers can manage their mortgage payments. The front-end ratio (housing expenses) should not exceed 29% of your gross monthly income, and the back-end ratio (total monthly debt obligations) should not exceed 45%. Exceptions can be made for borrowers with compensating factors, such as higher credit scores or additional cash reserves.

Kentucky USDA Property Requirements

USDA loans are intended for properties in designated rural areas. The USDA provides an online tool to check property eligibility. The home must be used as the primary residence and meet certain quality standards according to Kentucky FHA Appraisal HUD Guidelines  including:

  • Adequate and functional heating, plumbing, and electrical systems
  • Structurally sound foundation and roof
  • Safe water supply and waste disposal systems
  • Must have an undamaged exterior, foundation and roof
  • Must have safe and reasonable property access
  • Must not contain loose wiring and exposed electrical systems
  • Must have all relevant utilities, including gas, electricity, water and sewage functioning properly.
  • Must have a working, permanent heating system that can heat the property adequately
  • Must have surfaces free of chipping or peeling lead-based paint
  • Must have adequate access to attic spaces and natural ventilation in crawl spaces
  • Must have access to potable water
  • Must be free from wood-destroying insect infestations
  • Must not have interior and exterior health and safety hazards, such as no handrails on steep staircases
  • Must be a marketable property

Mortgage Insurance Required For Kentucky USDA loan Approval

Kentucky Rural Housing USDA loans require mortgage insurance, which includes an upfront guarantee fee and an annual fee. The upfront fee is typically 1% of the loan amount, which can be financed into the loan. The annual fee, usually 0.35% of the loan balance, is paid monthly as part of the mortgage payment. These fees help protect lenders and the USDA in case of borrower default.

Summary

Qualifying for a USDA home loan in Kentucky involves meeting specific criteria in several areas:

  • Credit Score: Minimum 640 for streamlined processing; lower scores may require manual underwriting.
  • Income Requirements: Must not exceed 115% of the median income for your area.
  • Work History: At least two years of stable employment.
  • Bankruptcy and Foreclosure: Waiting periods of 1-3 years depending on the situation.
  • Debt-to-Income Ratio: 29% for housing expenses, 41% for total debt; exceptions possible.
  • Property Requirements: Must be in a designated rural area and meet quality standards.
  • Mortgage Insurance: Includes an upfront guarantee fee and an annual fee.

By understanding and meeting these requirements, you can take advantage of the USDA loan program to achieve homeownership in Kentucky’s rural areas. For personalized assistance, consider consulting with a mortgage broker or lender experienced in USDA loans, like Joel Lobb in Louisville, who can guide you through the process and help you qualify.

Joel Lobb  Mortgage Loan Officer

American Mortgage Solutions, Inc.
10602 Timberwood Circle
Louisville, KY 40223
Company NMLS ID #1364

Text/call: 502-905-3708

email: kentuckyloan@gmail.com

http://www.mylouisvillekentuckymortgage.com/

 

 

How to get best mortgage rates in Kentucky for FHA VA USDA and Fannie Mae conventional loans


To get the best Kentucky mortgage rates in Kentucky for FHA, VA, USDA, and Fannie Mae conventional loans, you should consider several key factors and steps:

1. Improve Your Credit Score for best Kentucky Mortgage Loan Rate

  • Kentucky Credit Score Requirements:
    • Kentucky FHA Loans: Typically require a minimum score of 580, but better rates are available with scores above 780.
    • Kentucky VA Loans: No official minimum, but lenders often prefer scores above 780.
    • Kentucky USDA Loans: Generally require a minimum score of 780.
    • Kentucky Conventional Loans: Prefer scores above 620 for competitive rates, but the best rates are usually available for scores above 780.
  • Actions to Improve Your Score:
    • Pay bills on time. Last 24 months weighted heavily
    • Reduce credit card balances to less than 25% of outstanding balance
    • Avoid opening new credit accounts before applying for a loan. Keep inquires to a minimum

2. Save for a Larger Down Payment in Kentucky

  • Down Payment Impact:
    • Larger down payments often result in lower interest rates and better loan terms.
    • Kentucky FHA Loans: Minimum down payment of 3.5%.
    • Kentucky VA Loans: Often no down payment required.
    • Kentucky USDA Loans: No down payment required.
    • Conventional Loans: Minimum down payment of 3%, but better rates with 40% down.

3. Shop Around for Lenders in Kentucky

  • Compare Offers: Get quotes from multiple lenders, including banks, credit unions, and mortgage brokers like Joel Lobb in Louisville, Kentucky.
  • Negotiate: Use the quotes to negotiate better terms.
  • Consider Different Loan Types: Each loan type may offer different rates and terms, so compare FHA, VA, USDA, and conventional loans.

4. Maintain a Stable Employment History

  • Employment Consistency: Lenders prefer a steady employment history of at least two years in the same field.
  • Income Verification: Provide proof of stable and sufficient income to support mortgage payments.

5. Lower Your Debt-to-Income Ratio (DTI)

  • DTI Requirements:
    • FHA Loans: Typically require a DTI below 43%.
    • VA Loans: Prefer a DTI below 41%, but can go higher with strong compensating factors.
    • USDA Loans: Generally require a DTI below 41%.
    • Conventional Loans: Prefer a DTI below 36%, but can accept up to 45% in some cases.
  • Reducing Debt: Pay down existing debt to improve your DTI ratio.

6. Consider Mortgage Points for the best mortgage rate in Kentucky

  • Buying Points: Pay for discount points to lower your interest rate. One point typically equals 1% of the loan amount and can reduce your rate by about 0.25%.

7. Lock in Your Rate for a Shorter term

  • Rate Lock: Once you find a favorable rate, ask your lender about locking it in. Rate locks usually last 30 to 60 days and protect you from rate increases during the lock period.  Locking in for shorter term, say 15 days or less will get you a better rate.

8. Leverage Government Programs and Assistance in Kentucky like the Mortgage Revenue Bond program

  • Kentucky State Housing Programs: Kentucky offers various first-time homebuyer programs and down payment assistance, which can help you qualify for better rates.
  • Federal Programs: Look into federal programs such as FHA, VA, and USDA loans that offer competitive rates and terms for eligible borrowers.

9. Work with a Knowledgeable Mortgage Broker in Kentucky to shop for the best rates with multiple lenders

  • Expert Advice: Mortgage brokers like Joel Lobb can help navigate the various loan options, provide personalized advice, and negotiate the best rates on your behalf.

10. Lock in rate for shorter term. 

Do a 15 year, or 20 year versus a 30 year term to get a lower rate.

By focusing on these factors and steps, you can increase your chances of securing the best mortgage rates available in Kentucky for FHA, VA, USDA, and Fannie Mae conventional loans.

​

—

Joel Lobb  Mortgage Loan Officer

American Mortgage Solutions, Inc.
10602 Timberwood Circle
Louisville, KY 40223
Company NMLS ID #1364

Text/call: 502-905-3708

email: kentuckyloan@gmail.com
http://www.mylouisvillekentuckymortgage.com/

NMLS 57916  | Company NMLS #1364/MB73346135166/MBR1574

Qualifying Loan Programs for First-Time Homebuyers in Louisville, Kentucky


Mortgage Guide for First-Time Home Buyers in Kentucky

Joel Lobb  Mortgage Loan Officer

American Mortgage Solutions, Inc.
10602 Timberwood Circle
Louisville, KY 40223
Company NMLS ID #1364

Text/call: 502-905-3708
fax: 502-327-9119
email: kentuckyloan@gmail.com

http://www.mylouisvillekentuckymortgage.com/

 A Guide to Buying Your First House in Kentucky Loan Programs


.

 A Guide to Buying Your First House in Kentucky: Loan Programs and Requirements


Kentucky First‑Time Homebuyer Loan Programs for FHA, VA, KHC and USDA Mortgage Loans in Kentucky

 A Guide to Buying Your First House in Kentucky: Loan Programs and Requirements

Louisville Kentucky Mortgage Broker Offering FHA, VA, USDA, Conventional, and KHC Zero Down Payment Home Loans -down payment, credit score, debt-to-income ratio, and work history requirements for Kentucky Mortgage loan approval for FHA, VA, USDA, Fannie Mae, and Down Payment Grants

Joel Lobb  Mortgage Loan Officer

American Mortgage Solutions, Inc.
10602 Timberwood Circle
Louisville, KY 40223
Company NMLS ID #1364

Text/call: 502-905-3708
fax: 502-327-9119
email: kentuckyloan@gmail.com

http://www.mylouisvillekentuckymortgage.com/

NMLS 57916  | Company NMLS #1364/MB73346135166/MBR1574The 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).

Credit Scores and Kentucky Mortgage Loans Answer to your questions


Credit Scores and Kentucky Mortgage Loans. Answer to your questions.

Credit Fico Score for a Kentucky Mortgage FHA VA KHC

 


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http://www.emailmeform.com/builder/form/0bfJs9b6bK8TGoc6mQk9hIu
 
Question:
What is the current minimum credit scores needed to qualify for a mortgage Loan in Kentucky?
Answer:
The minimum credit score needed to qualify for a Kentucky mortgage depends on the type of loan program you are looking to obtain, this could be the reason that you have received conflicting answers. The most common types of mortgage are Conventional, FHA, USDA, VA, and KHC mortgage loans in Kentucky. I’ll explain each briefly below and the minimum credit score needed to qualify for each loan program. Keep in mind these are continuously changing and can vary by lender do to credit overlays.
 
Kentucky Conventional or Fannie Mae  
Conventional loans make up the majority of mortgages in the US. They are also known as conforming loans, because they conform to specific guidelines set by Fannie Mae and Freddie Mac.
  • Minimum Credit Score is 620
  • You can use a conventional loan to buy a primary residence, second home, or rental property
  • Conventional loans are available in fixed rates, adjustable rates (ARMs), and offer many loan terms usually from 10 to 30 years
  • Down payments as low as 3% and 5% depending on Home Ready or straight conventional loan.
  • No monthly mortgage insurance with a down payment of at least 20%
  • Max Debt to Income Ratio of 50%
 
KENTUCKY FHA MORTGAGE
 
An FHA loan is a mortgage issued by federally qualified lenders and insured by the Federal Housing Administration (FHA). FHA loans are designed for low-to-moderate income borrowers who are unable to make a large down payment.
  • Minimum Credit Score is 500 with at least 10% down
  • Minimum Credit Score is 580 if you put less than 10% down
  • Upfront and Monthly Mortgage Insurance is required regardless of the Loan to Value
  • FHA Loans are only available for financing primary residences
  • Maximum Debt to Income Ratio of 50% (unless mitigating factors justify allowing a higher DTI) up to 57% in some instances with strong compensating factors.
KENTUCKY USDA RURAL HOUSING LOAN 
    • 100% Financing
    • Cities and towns located outside metro areas-see link (https://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=sfp
    • Do NOT have to be a First Time Home Buyer and no max loan limit just debt ratio requirements
    • No Down Payment
    • 30 year low fixed rate loans
    • No Prepayment Penalty
    • Great Low FIXED Interest Rates
    • Possible to Roll Closing Costs into Loan if Appraises Higher
    • No Cash Reserves Required
    • UNLIMITED Seller Contribution toward Closing Costs
    • 100% Gifted Closing Costs allowed
    • Primary Residents only (no rentals/investment properties)
    • Debt to income ratios no more than 45% with GUS approval and 29 and 41% with a manual underwrite.
    • Only Need a 580 Credit Score to Apply*** Most USDA loans need a 620 or score higher to get approved through their automated underwriting system called GUS. 640 usually required for an automated approval upfront.
    • No bankruptcies (Chapter 7) last 3 years and no foreclosure last 3 years. If Chapter 13 bankruptcy possible to go on after 1 year
     
  • KENTUCKY VA Mortgage
  • 100% Financing Available 
  • Must be eligible veteran with Certificate of Eligibility. We can help get this for veterans or active duty personnel.
  • No Down Payment Required
  • Seller Can Pay ALL Your Closing Costs
  • No Monthly Mortgage Insurance
  • Minimum 580 Credit Score to Apply–VA does not have a minimum credit score but lenders will create credit overlays to protect their interest.
  • Active Duty, Reserves, National Guard, & Retired Veterans Can Apply
  • No bankruptcies or foreclosures in last 2 years and a clear CAVIRS
  • Debt to income ratios vary, but usually 55% back-end ratio with a fico score over 620 will get it done on qualifying income and if it is a manual underwrite, 29% and 41% respectively
  • Can use your VA loan guaranty more than once, and in some cases, can have two existing va loans out at they sametime. Call or email for more info on this scenario.
  • Cost of VA loan appraisal in Kentucky now costs a  minimum $475 with a termite report needed on all purchase and refinance transactions unless a condo.
  • 2 year work history needed on VA loans unless you can show a legitimate excuse, ie. off work due to injury, schooling, education etc.
  • You cannot use your GI Bill for income qualifying for the mortgage payment.
KENTUCKY HOUSING DOWN PAYMENT ASSISTANCE 100 FINANCING 
 

How the Down Payment Assistance Program (DAP) Works

 Down payment assistance loans are available up to $10,000 and is paid back over a period of ten years at a current rate of 3.75%.

Regular DAP

  • Purchase price up to $481,176 with Secondary Market​ or Mortgage Revenue Bond (MRB) income limits.
  • Assistance in the form of a loan up to $10,000 in $100 increments.
  • Repayable over a 10-year term at 3.75 percent.
  • Available to all KHC first-mortgage loan recipients
 
If you have questions about qualifying as first time home buyer in Kentucky, please call, text, email or fill out free prequalification below for your next mortgage loan pre-approval.
 

. KHC Loan (Kentucky Housing Loan with Down Payment Assistance)

 

The  no money-down home  loan program offered by Kentucky Housing and other lenders in the state of Kentucky currently offers up to $10,000-or a 5% grant of the sales price offered by other national lenders that does not have to be repaid

 
 
 
 
 
 
 
 
 
 
 
 
 

—

Joel Lobb
Mortgage Loan Officer
 
Individual NMLS ID #57916
 
American Mortgage Solutions, Inc.
10602 Timberwood Circle 
Louisville, KY 40223
 
Company NMLS ID #1364
 
 

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

 
 

 

Fannie Mae According to the “Washington Post,” Fannie Mae raised its minimum credit score for conventional loans in 2009 from 580 to 620. Even if you have a 20-percent down payment, you…

Source: Credit Fico Score for a Kentucky Mortgage FHA VA KHC