Kentucky Single Family Housing USDA RHS Guaranteed Loan Program Update 2011.
via Kentucky Single Family Housing USDA RHS Guaranteed Loan Program Update 2011.
Kentucky USDA Mortgage Lender for Rural Housing Loans
I am a Kentucky based USDA Mortgage Lender that has originated over 200 KY Rural Housing Mortgage Loans in Kentucky, Put my expert advice to use. Kentucky Rural Development RHS loans give KY Rural Homebuyers a zero down mortgage loan with a low 30 year fixed rate loan. A Local Kentucky Rural Housing Mortgage Lender offering same day free approvals and credit report. This website is not affiliated with USDA or any other government agency. NMLS#57916 Equal Housing Lender Text or call today 502-905-3708 with your mortgage questions about USDA Rural Housing Loans in Kentucky. Free Pre-Approvals on most applications within the same day. Kentuckyloan@gmail.com NMLS# 57916 Joel Lobb Loan Originator, American Mortgage Solutions NMLS ID. 1364 Equal Housing Lender
|2013 Credit Requirements for A Kentucky Rural Housing RHS Mortgage Loan|
1. Equifax Beacon 5.0
2. Transunion FICO Risk Score, Classic 04
3. Experian/Fair Isaac Risk Model V2.
GUS Approved: Each credit report must contain 2 acceptable tradelines with at least 12 month history and last active within the last 24 months (see below regarding acceptable tradelines).
Manual Underwrite: As determined acceptable by the underwriter.
o Middle of 3
o Lower of 2
o If only one score is provided, that score is the qualifying credit score for that borrower.
Minimum credit score for:
LIABILITIES & CREDIT HISTORY
|OPEN CHARGE ACCOUNTS|
|ALIMONY, CHILD SUPPORT, OR SEPARATE MAINTENANCE||
|DEFERRED INSTALLMENT DEBT||May not be omitted from debt ratio. 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.|
|NON-REIMBURSED EMPLOYEE EXPENSES||If the borrower claims any non-reimbursed employee expenses (IRS Form 2106 or 1040 Schedule A), the borrowers monthly income should be reduced by the annualized monthly average.|
|BUSINESS DEBT IN BORROWER’S NAME||When the account in question does not have a history of delinquency, the debt may be excluded with satisfactory evidence the obligation was paid out of company funds (such as 12 months cancelled company checks). If the account in question has a history of delinquency, the full debt obligation must be included in the borrower’s debt ratio.|
|FINANCED PROPERTIES||Additional financed properties are generally not permitted as borrower may not own any other suitable housing at time of closing.|
|DEBTS WITH <6 REMAINING PAYMENTS||The total debt ratio should include revolving debt regardless of when the debt will be retired. Installment loans will only be considered if the debt will be retired in more than six months. However, if the monthly payment on the debt is substantial, the payment will also be included in long term debt. The GUS system will automatically exclude debt that is eligible to be excluded. If not excluded by GUS the debt must be included in the debt ratio.|
|“PAYING DOWN” ACCOUNTS||Not permitted. Settlement offers will not be considered as proof of balance|
|SETTLEMENT OFFERS||Are acceptable on accounts that will be paid in full at closing as long as the offer is in writing from the creditor reporting on the credit report.|
|PAST DUE ACCOUNTS (NOT A COLLECTION OR CHARGE OFF)||Recent derogatory credit >1×30 within the previous 12 months is not permitted unless approved by GUS. All past due accounts must be current at time of closing.|
|COLLECTIONS/ CHARGE OFFS||
Any unpaid Collections/Charge offs will require a satisfactory letter of explanation from the borrower.
|OUTSTANDING FEDERALLY INSURED OR GUARANTEED DEBT||Borrower(s) must have an acceptable existing repayment plan (minimum of 12 months), and/or be required to pay account in full prior to, or at closing. Borrower must also be cleared through CAIVRS.|
|BANKRUPTCY (ALL)||3 years seasoning required from Discharge or Dismissal date.|
|FORECLOSURE||3 years seasoning required.|
|DEED-IN-LIEU OF FORECLOSURE||3 years seasoning required.|
|SHORT SALES||3 years seasoning required.|
|COMPENSATING FACTORS||Some compensating factors include:
|MULTIPLE RISK LAYERING||Multiple risk layering is not allowed on manually underwritten loans:
1) Kentucky USDA loans and rural housing underwriting is tightening up! You are going to see us asking for more to make sure we have it to respond to USDA when they ask for it. We don’t want to be caught shorthanded on these deals and be stuck waiting to get them closed (neither do you!) so to be reactive to the changes with USDA, you will find that we are conditioning for more than we used to. To help us be on the ball with your USDA loans, be sure to include the following:
1) 30 days most recent paystubs showing a YTD amount
2) VOE’s if the borrower is NOT employed in the same position for more than 2 years or the borrower has OT, Bonus or commission income. We will recommend Written VOE’s for the purpose of showing the borrower is in the same line of work!
3) Assets – if your 1003 shows bank information and asset information then you must provide the most recent 2 statements to prove this information
4) Collections & open judgments must show on your liabilities. Please provide an LOX for all Derogatory credit this LOX should show that the circumstances were temporary in nature, beyond the applicant’s control and resolved to the best of their ability
5) VOR‘s are required for all USDA loans. USDA has been consistently requesting this information in the past 30 days. For files above 640, a VOR will suffice. For files under 640, we will require 12 months cancelled checks. If a VOR is not available due to the borrower living with family, an LOX will be needed
6) Paystubs for all income in the household regardless if they are on the loan or not. Must be most recent and 30 days worth to help determine actual income
7) Garnishments or child support shown and if paying it we will require the court order. If receiving it, we need a 12 month history of receipt and court order
8) W-2’s for the past 2 years for ALL jobs
9) Tax returns if self employed or unreimbursed expenses are shown
10) YTD P&L if self employed prepared by tax preparer and signed by borrower.
11) 1980-21 signed by borrowers
12) Fully executed purchase contract
Remember – we cannot send a file to RD without an appraisal!!! The appraisal must state that the property meets HUD Handbooks 4150.2 and 4905.1.
2) Turn times for USDA in several states are extreme. We understand your frustration with the delays and want to express to you that we are watching diligently for return commitments to push your files to closing. If you could review your USDA loans with us and insure that all conditions are met….except for the CC…we can expedite these files ASAP when the commitment comes in. If your file has been with us for over 30 days, please update the paystubs as ours will have expired!!!
Thank you for your attention and please let me know if you need me!