Tag: Lexington Kentucky

How do you qualify for a USDA Mortgage if you are self-employed?


USDA Home Loans for the Self-Employed

 

Kentucky USDA Rural Housing Mortgage Loans
Kentucky USDA Rural Housing Mortgage Loans

 

 

 

 

 

 

Looking for a home loan when you are self-employed can be a bit challenging but a USDA loan may be a great option. Many banks and lenders shy away from this type of loan due to the complex nature and experience that it requires. These scenarios can be complicated but with proper analysis and documentation the outcome can be successful. This short video will explain how to qualify for a USDA home loan if you are self-employed.

via How do you qualify for a USDA Mortgage if you are self-employed?.

Who are considered self-employed when applying for a USDA loan?

• 1099 Contractors are considered self-employed
• W2 Employees who are 100% commissioned
• Converting from a self-employed to a W2 employee can be acceptable

What are the USDA guidelines for the self-employed?

Minimum guidelines require that a self-employed borrower must have 2 years of self-employment history. Common documents that will be needed for verification purposes include articles of incorporation when applicable and at least 2 years of both business and personal tax returns. Also, keep in mind your tax returns should include all pages and schedules. If you filed an extension, make sure to have the signed extension available for underwriting.

Tax return documentation includes but not limited to:

• Business tax returns for corporations
• Schedule C for sole proprietors
• Partnership details if applicable
• Signed extensions when necessary
• Year to Date Profit & Loss Statement
• Year to Date Balance Sheet

What are the USDA home loan income limits for the self-employed?

As with all USDA home loans, income limits will apply and qualifying income for a USDA home loan for the self-employed is based on your adjusted income. The adjusted income is calculated after expenses are deducted. Your qualifying income is not based on gross commissions or your total sales. When following USDA guidelines for self-employment, alternative income documentation such as bank statements showing deposits are not acceptable. Read more about the USDA eligibility requirements for the self-employed.

We realize that qualifying when you are self-employed may seem overwhelming, but we offer the unique experience and expertise to help with each step of the process.

Joel Lobb
Senior  Loan Officer
(NMLS#57916)
American Mortgage Solutions, Inc.
800 Stone Creek Pkwy, Ste 7,
Louisville, KY 40223
 Fax:     (502) 327-9119
 
 Company ID #1364 | MB73346
Rural Housing Mortgage Loans in Kentucky
Rural Housing Mortgage Loans in Kentucky
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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

4 Ways You Might Be Hurting Your Credit Score (And What You Can Do About It)


Factors contributing to someone's credit score...
Factors contributing to someone’s credit score, for Credit score (United States). (Photo credit: Wikipedia)

4 Ways You Might Be Hurting Your Credit Score (And What You Can Do About It).

Kentucky FHA, VA, KHC, Rural Housing and Fannie Mae Loan Free Pre-Approvals for Mortgage Loans

via 4 Ways You Might Be Hurting Your Credit Score (And What You Can Do About It).

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How Can A First Time Home Buyer With Bad Credit Get A House?


How Can A First Time Home Buyer With Bad Credit Get A House?.

via How Can A First Time Home Buyer With Bad Credit Get A House?.

HAC News: September 26, 2012 – Housing Assistance Council


HAC News: September 26, 2012 – Housing Assistance Council.

September 26,2012
Vol. 41, No. 19

SEPTEMBER 15-OCTOBER 15 IS NATIONAL HISPANIC HERITAGE MONTH, proclaimed by President Obama.

CONTINUING RESOLUTION TO FUND GOVERNMENT FOR SIX MONTHS. Both the House and Senate passed H.J. Res. 117, keeping housing programs and almost all others at FY12 funding levels through March 27, 2013. President Obama is expected to sign it.

USDA DELAYS CHANGES TO RURAL DEFINITION FOR HOUSING PROGRAMS. Administrative Notice 4679 (September 25, 2012) announces that current area eligibility will remain unchanged until March 27, 2013, when the continuing resolution ends. After that date, USDA will use 2010 Census data to determine what places fit the definition of rural, unless Congress extendsgrandfathering of housing program eligibility for growing rural communities. Before Congress adjourned two new bills were introduced: S. 3541 would grandfather currently eligible places for ten years, H.R. 6416 for one year. New HAC research found that in 2011 as many as one-third of Section 502 direct loans and 40% of Section 502 guaranteed loans were made in these areas.

SEQUESTER REMAINS IN PLACE. Before adjourning Congress did not change the “sequestration” – cuts in federal funds – required in January, although a variety of bills have been introduced. The Administration’s sequestration report to Congressindicates how each agency will implement the requirement to cut 8.2% of nondefense discretionary funding, including housing programs. USDA and HUD will cut each housing program account by 8.2%. (Some program accounts encompass one program while others include several.)

FARM LABOR HOUSING APPLICATIONS NOW DUE OCTOBER 31. A notice in the Federal Register, 9/23/12, also makes other changes to the NOFA. (See HAC News, 7/25/12.) Contact an RD state office.

“DYNAMIC SERVICING STRATEGIES” NOTICE FOR USDA MULTIFAMILY PROPERTIES REISSUED. An Unnumbered Letter dated August 31, 2012 repeats instructions to RD field staff regarding prompt action on troubled multifamily properties. Contact Stephanie White, USDA, 202-720-1615.

NEW CAPITAL NEEDS ASSESSMENT GUIDANCE ISSUED FOR USDA MULTIFAMILY PROPERTIES. See Unnumbered Letter dated August 7, 2012. Contact Carlton Jarratt, USDA, 804-287-1524.

RESPA AND TILA INPUT REQUESTED. Comment by October 9 on changes the Consumer Financial Protection Bureau proposes in Real Estate Settlement Procedures Act and Truth in Lending Act regulations on mortgage loan servicing and disclosures. SeeCFPB’s web site or regulations.gov. Contact Jane Gao, CFPB, 202-435-7700.

USDA PROVIDES RESPA GUIDANCE FOR SECTION 502 DIRECT. Administrative Notice 4676 (August 27, 2012) instructs RD staff on implementation of RESPA disclosure and accuracy requirements, and on good faith estimates and the HUD-1 “Settlement Statement.” Contact Migdaliz Bernier, USDA, 202-690-3833.

HUD SEEKS NOMINATIONS FOR NAHASDA COMMITTEE. The negotiated rulemaking committee will review the Indian Housing Block Grant funding formula. Nominations are due November 19. See Federal Register, 9/18/12 or regulations.gov. Contact Rodger Boyd, HUD, 202-401-7914.

USDA DISCONTINUES RURAL ENERGY PLUS FOR 502 DIRECT. The program, which makes it easier for homebuyers to qualify for loans for energy-efficient homes, remains in effect for Section 502 guarantee borrowers. See Unnumbered Letter dated September 10, 2012. Contact Christopher Ketner, USDA, 202-690-1530. HAC has learned from RD that a replacement program will be implemented in 2013.

GAO REPORT EMPHASIZES SIMILARITIES BETWEEN USDA, FHA, AND VA GUARANTEE PROGRAMS. Housing Assistance: Opportunities Exist to Increase Collaboration and Consider Consolidation (GAO-12-554) reiterates previous findings (for example, see HAC News, 3/7/12) and adds new data. In 2009, FHA guaranteed more single-family and multifamily loans, even for low-income residents of remote rural areas, than USDA. Detailed data on income levels and other characteristics are not included in the report. GAO suggests improving an Administration task force evaluating coordination or consolidation of single-family programs and recommends the agencies identify specific programs for consolidation. Contact Mathew Sciré, GAO, 202-512-8678.

SLIGHTLY FEWER USDA TENANTS ARE COST BURDENED. USDA’s annual occupancy survey shows 2,135 fewer units and 1,254 fewer occupied units (households) in Section 515 and 514/516 properties in 2012 than 2011, as well as 1,243 more households receiving Section 521 RA, 931 fewer with rental aid from other sources, and 1,562 fewer experiencing cost burdens. Contact Janet Stouder, USDA, 202-720-9728.