Kentucky VA Home Loans Approval Criteria


via Kentucky VA Home Loans Approval Criteria

Basic Requirements

While VA loans don’t require a down payment and easier qualifying compared to conventional loan programs, there are still basic requirements that lenders must follow. The lender must adhere to the VA issued loan guidelines in order for the loan to be eligible for the VA loan guarantee.
Credit

VA borrowers must exhibit a responsible credit history, documented by a credit report. The credit report will show the credit history of the borrower as well as provide at least two credit scores. The credit score is a three digit number assigned to the level of credit risk associated with the borrower. The higher the credit score, the better the credit. The VA doesn’t establish a minimum credit score requirement but most VA lenders ask for a 620 credit score or better.

If the borrower doesn’t have a credit score or hasn’t established a credit history, some VA lenders allow for a “manual” credit approval. A manual approval means verifying at least three non-traditional forms of credit with a minimum two year history in addition to verification of a timely rent history. Non-traditional credit can be a cell phone bill, utility or cable bill. Note, not all VA lenders offer the manual approval option.
Income

VA lenders must certify the borrower’s ability to repay monthly debt. This is performed by calculating debt-to-income ratios, represented as a percentage of a borrower’s gross monthly income. VA loan requirements ask for a debt ratio to be no greater than 41 percent of gross household income. Although the ratio is not a strict limit, some VA lenders adhere to this number and will only allow a slightly higher ratio of say 42 to 44 if the borrower has an excellent credit history or significant cash reserves.
Occupancy

VA loans are intended for purchasing a primary residence only and cannot be used for investment property.

Why Use a VA Lender?

It’s important to use a VA lender that has been approved by the VA. Some mortgage companies who accept VA loan applications send the VA loan to yet another lender for approval. While VA loans are easier to qualify for, they have their own internal “quirks” that make the approval process a bit different compared to other loan types. Lenders who are not familiar with VA loans may stumble with a VA loan, extending the loan approval process unncesscarily or worse, having the loan declined needlessly.

Approved VA lenders have been fully vetted by the Department of Veteran’s Affairs and must meet strict VA loan experience guidelines and exhibit minimum financial net worth requirements.
LAPP

The Lender Appraisal Processing Program, or LAPP, is a streamlined method of ordering and evaluating a property appraisal. Lenders without this special authority must order the VA appraisal directly from the Department of Veteran’s Affairs, adding unnecessary time to the loan approval.
ACE

VA approved lenders have access to ACE, the Automated Certificate of Eligibility. By providing your VA loan application and authorization forms to your VA approved lender, your certificate of eligibility can be requested and obtained almost instantly by the lender.
Non-Supervised Automatic Authority

This designation allows a VA approved lender to evaluate and approve the entire VA loan package with no VA involvement. This allows a lender to streamline the loan approval process and close loans quickly.

7-Step Process for Getting a VA Loan

1. Get Prequalified Your very first step is getting prequalified. A prequalification is obtained by speaking with a VA-approved lender and reviewing your current financial picture with a loan officer. The loan officer will ask questions about your gross monthly income, current debt and your overall credit profile.

This conversation will tell you how much you may qualify for, what your monthly payments might be and how much money you’ll need to bring to the closing table. Knowing your price range will give you and your real estate agent a starting point when you begin your home search.

2. Gather Your Documentation Now it’s time to start gathering the paperwork necessary to start your VA loan process. You’ll be asked to provide your most recent pay check stubs covering at least 30 days, your two most recent W2 forms and your most recent bank and investment statements. If you’re self-employed, you will need to provide the past two years personal and business income tax returns and a year-to-date profit and loss statement

3. Your Certificate of Eligibility The certificate of eligibility is a document generated by the Department of Veteran’s Affairs validating your eligibility for a VA loan. You can obtain your certificate of eligibility by visiting your nearest regional VA center, mailing in your request or obtaining a copy online. To request your certificate, you’ll need to complete the DOD form 26-1880 and have a copy of your DD-214 as well. Yet the easiest way to obtain your certificate of eligibility is having a VA-approved lender request it for you.

4. Get Pre-approved A pre-approval is an upgrade from a prequalification. A pre-approval is issued after you apply for a VA loan and provide the necessary documentation to your VA lender. Once your credit report is pulled, your application will be reviewed and submitted for an automated approval. The only thing missing at this stage is the property address.

Your lender will then provide you with your pre-approval letter which verifies that you have completed an application and documented your loan and all you need to do next is find a property.

5. Go Shopping Now the fun part begins! Find a real estate agent that is familiar with the VA loan process. VA loans require zero money down but you should also negotiate to have the seller pay your closing costs for you. An experienced real estate agent can help guide you through the negotiations to get the right house at the right price.

Once your offer is accepted, your agent will provide you with a list of property inspectors who will physically inspect your new home from basement to the rooftop highlighting any issues that need to be addressed.

6. Processing and Underwriting The moment your sales contract is signed by you and the seller, the clock begins to tick. Most sales contracts allow for a 30 day closing period but may be adjusted depending upon your agreement with the seller.

Your lender will order a property appraisal to support the sales price as well as obtain a copy of the property’s title report. Your loan is now “in process” and you will work with both your loan officer and loan processor. The processor prepares the file for final underwriting.

The underwriter is the individual that manually reviews your file and supporting documentation to determine that your loan meets the required VA guidelines. Once that determination is made, your loan is forwarded to the closing department.

7. Closing and Funding The closing department prepares your loan documents and sends your loan papers electronically to your settlement agent who will oversee the closing. The settlement agent will prepare an initial settlement statement called the HUD-1. This is a form that accounts for all the charges, deposits and credits associated with your loan closing and itemizes any and all costs for which you’re responsible and tally the final amount needed from you to close

At your closing, you will review, initial and sign your final closing papers and provide the amount needed to close your VA loan. Your settlement agent will follow the closing instructions issued by your lender then forward the signed documents to the funding department.

The “funder” will make sure the settlement agent followed the instructions to the letter then release your funds to the settlement agent. Congratulations, you’re a home owner!

FAQ’s

VA loans are hands-down the preferred choice for those who qualify searching for a competitive loan program with no money down. VA lending guidelines are similar to those with other loan types and are approved and documented in much the same fashion as conventional loans. However, VA loans do have specific requirements that make the program unique and do have additional requirements. Here is a list of some common questions.

Since the VA guarantees my loan, does that mean I’m guaranteed a VA loan?
No, the VA guaranty is to the lender approving your VA loan. As long as the lender approves your loan using established VA guidelines, should the loan ever go into default, the lender can receive compensation of 25 percent of your loan amount. Lenders will still review your income and credit amount other requirements before issuing an approval.

What are “non-allowable” closing costs?
The VA restricts certain closing costs that may be charged to and paid for by the veteran. Your VA lender can provide you with a list of these restricted fees along with other charges that you may be responsible for.

What credit score does the VA require?
Credit scores, a 3-digit number reflecting your current credit profile, are not required by the VA. However, most VA lenders do require a minimum credit score with lenders asking for a score to be at or above 640.

How do I know if I qualify for a VA loan?
VA lenders must review your certificate of eligibility to determine whether or not you’re eligible for a VA loan. However, basic requirements ask that you have more than 180 days of active duty service, an honorably discharged veteran, served six years in the National Guard or Reserves or the spouse of a service member who died as a result of a service-related injury.

What types of loans does the VA offer?
All VA lenders provide loan choices in both fixed rate and adjustable rate loans. Most lenders offer fixed rate terms of 10, 15, 20, 25 and 30 years. Adjustable rate mortgages are typically issued as hybrids, where the initial rate is fixed for a predetermined period before changing into a loan that can adjust annually.

What is a funding fee?
The funding fee is an insurance premium that finances the VA guarantee on your loan and is expressed as a percentage of the amount borrowed. This percentage can vary based upon loan type, equity and other loan characteristics but the funding fee for a first time purchase with no money down is 2.15 percent of the loan. The funding fee may be rolled into the loan amount in lieu of paying out of pocket. Most borrowers choose to roll the fee into the loan.

Do all lenders offer VA loans?
VA loans are typically offered by most lenders but it’s important to work with a lender that is an approved VA lender. An approved VA lender is authorized to process, underwrite and fund a VA loan. It’s important that you work with a lender with extensive VA experience to help you navigate your way through the VA approval process.

Can I use a VA loan more than once?
Yes, you can use a VA loan more than once as long as your original entitlement is restored. Your entitlement is restored when you sell your house and pay off the existing VA home loan.

What is my entitlement?
The entitlement issued today is $36,000 and the VA will guarantee a loan up to four times that amount, or $144,000. For loans above that, the VA guarantee will be 25 percent of the loan amount up to $417,000. In certain “high cost” areas, the guarantee and maximum loan amounts are greater.

 

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2018 Kentucky First Time Home Buyer Loan Programs


via 2018 Kentucky First Time Home Buyer Loan Programs

 

Getting a mortgage for a home can seem like a complicated and mysterious process. Just like any good investment, you should never buy anything that you don’t understand.  Knowing how the mortgage lending system works will relieve much of the stress and anxiety associated with making what is most likely the largest purchase of your entire life. This article will help you understand…

What You Need To Know About A Mortgage… BEFORE You Get One!!!

Qualifying for a Mortgage

Home LoansMortgage companies are in business to make money by lending money that is secured by an asset large enough to sell and recover their capital if the borrower is no longer able or willing to pay the payments. They are not in the business of owning property and would rather not have to foreclose on a loan, repossess the property and sell it to recapture their capital. This does happen but it is not their primary business. They would rather have their borrowers make their payments so that they could collect the interest and move on down the road. To increase their odds of that happening, mortgage companies look at several areas of your financial history to determine if you will meet their standards. This is called Qualifying for a Mortgage.

What the mortgage company finds when they look at these areas will help determine the type of mortgage that is available to you and the interest rate you will pay on the money that you borrow.

The areas that they are interested in looking at are:

Job History

Lenders want to know if you have been in your current job and/or profession for at least two years. They also want to know if you are retired or self-employed.

Income

TaxesMortgage lenders want to know how much your monthly income is before taxes are taken out (Gross Monthly Income). Typically you will be asked to provide check stubs for the last 30 days and Federal Tax Returns or W-2’s for the last two years to prove your income.

If you are self-employed and it is difficult for you to prove your gross income to the lender you may be able to get a “stated income” loan. If that is the route that you take, your income must be “reasonable” for your profession. Since stated income loans are riskier for the lender you will generally have a higher interest rate.

Credit History

Mortgage lenders really like it if you have a history of paying your bills on time. This is reflected in your credit report and FICO score. If you have “bad credit”, you are NOT automatically disqualified from getting a mortgage. Lower credit scores will increase the interest rate that you will be required to pay and sometimes that increase will be quite significant.

Debt Load

You can have an awesome job with an income to make Bill Gates jealous and a great credit score but if you have already acquired too much long term debt you may not qualify for the loan you want.

assetsAssets

Mortgage lenders will want to check your bank accounts to make sure that you have the cash necessary to pay the down payment and closing costs and that you have “reserves” available to make the loan payment. Often, the lender will require 3-6 months reserves. (Reserves can be in a 401K or other retirement account that you can pull the money out of)

Requested Loan Amount

The loan you are requesting will need to be proportional to your ability to make the payments. Be reasonable with your house buying expectations – don’t expect to buy a lot more house than you can afford. The recent housing bust defined the term “house poor” and got a lot of people into financial trouble. Again, mortgage lenders would much rather you make your monthly house payments because everyone loses if they have to foreclose.

Determining YOUR Mortgage Interest Rate

The market place determines the range of interest rates available for any mortgage and the lending rates change daily. The specific interest rate you will pay is based on how well qualified you are and the type of loan you want.

Interest rates are typically based on the answers to these questions:

How Good Is Your Credit Score? 

FICO ScoreThe most widely used score is the FICO score, the credit score created by Fair Isaac Corporation. Lenders use the FICO Score to help them make billions of credit decisions every day. Fair Isaac calculates the FICO Score based solely on information in consumer credit reports maintained by the credit reporting agencies.

FICO credit scores range from 300 to 850. That FICO Score is calculated by a mathematical equation that evaluates many types of information from your credit report, at that agency. By comparing this information to the patterns in hundreds of thousands of past credit reports, the FICO Score estimates your level of future credit risk.

With the top end of the credit score being 850, anything above about 720 is considered excellent. Some local lenders set 740 as the benchmark for their preferred interest rates. Having a lower credit score DOES NOT mean you will not get a loan. You may qualify BUT your interest rate will be higher than someone with better credit.

How Big Is Your Down-Payment?

down-paymentThe Down-Payment is the amount of your own money you are going to put into buying the property. The more money you put into the property on the front end, the lower the risk of you not paying the payments. The amount of your down payment also directly affects the amount of your loan (purchase price – down payment = loan amount). This is called the Loan to Value Ratio (LTV).

The LTV is the percentage of the value of the house that the mortgage will cover (loan amount / purchase price x 100). For example, the property you are interested in buying is selling for $100,000. You have $20,000 for the down-payment and want a mortgage for the other $80,000. The LTV for this mortgage is 80%.

Similar to the LTV is the Combined Loan to Value Ratio (CLTV). The CLTV is used when 2 loans are used to finance the home purchase. You may see or hear terms like “80-20” or “80-15-5”. This refers to the 1st lien percentage (80), the 2nd lien percentage (20 or 15) and the down payment percentage (5).

How Much Debt Do You Currently Have?

It only makes sense that the more debt you have the riskier the loan is for the lender. There is a finite amount of income in all of our households and it all gets allocated every month. Lenders use a “debt-to-income” ratio to determine how qualified you are for the loan based on how much debt you already have.

debt_to_income_ratioYour Debt to Income Ratio (DTI) is the percentage of your income that you owe in debt on a monthly basis. For example, if you make $5,000 per month, and have debt payments (car loans, credit cards, student loans, etc.) of $2,000, your DTI ratio is 40%. The higher this ratio is, the less likely you will be to qualify for a low interest rate.

Conventional loans typically have a qualifying ratio of 28/36. FHA loans will sometimes allow for a higher debt load of 29/41 qualifying ratio.

The first number in a qualifying ratio is the maximum percentage of your gross monthly income that can be applied to your mortgage. That includes the loan principal and interestprivate mortgage insuranceproperty taxeshomeowners insurance, and homeowner’s association dues.

The second number is the maximum percentage of your gross monthly income that can be applied to housing expenses and recurring debt. Recurring debt includes monthly payments for carsboatsmotorcycleschild support payments and monthly credit card payments.

 Example:  of a 28/36 qualifying ratio:

Gross monthly income of $5,000 x .28 = $1400 can be applied to housing.

Gross monthly income of $5,000 x .36 = $1,800 can be applied to recurring debt plus housing expenses

Example: of a 29/41 qualifying ratio:

Gross monthly income of $5,000 x .29 = $1,450 can be applied to housing.

Gross monthly income of $5,000 x .41 = $2,050 can be applied to recurring debt plus housing expenses

These are just general guidelines and everyone’s personal finances are unique. To get the real answer about how well you qualify and to determine how large a mortgage a local lender will offer contact one of our preferred lenders and visit with a loan officer.

Here is a KEY point to remember…

FICO KEYYour credit score is THE most vital piece of information

when qualifying for a loan.

I am a Dave Ramsey fan and I believe in paying cash but even Dave concedes when it comes to buying a house. In Financial Peace Dave calls the FICO score an “I love debt score” and brags about not having one. He even tells a story about trying to rent an apartment and he couldn’t because he doesn’t have a FICO score. He then says, “I can’t rent an apartment because I don’t have a FICO score… I could write a check and buy the whole complex but I can’t rent an apartment because I don’t have a credit score!” Which is a great story for someone that CAN write a check and buy the whole complex… The rest of us need to maintain a really good credit score.

If you’re ready to buy a new home

and want to shop around for the best deal on a mortgage…

Looking for a mortgage, auto or student loan may cause multiple lenders to request your credit report, even though you are only looking for one loan. To compensate for this, the score ignores mortgage, auto, and student loan inquiries made in the 30 days prior to scoring. So, if you find a loan within 30 days, the inquiries won’t affect your score while you’re rate shopping. In addition, the score looks on your credit report for mortgage, auto, and student loan inquiries older than 30 days. If it finds some, it counts those inquiries that fall in a typical shopping period as just one inquiry when determining your score. For FICO scores calculated from older versions of the scoring formula, this shopping period is any 14 day span. For FICO scores calculated from the newest versions of the scoring formula, this shopping period is any 45 day span. Each lender chooses which version of the FICO scoring formula it wants the credit reporting agency to use to calculate your FICO score.

What Type of Loan Are You Looking For?

40 year fixed, 30 year fixed, 20 year fixed, 15 year fixed, 10 Year Fixed, Adjustable Rate, etc. All of these loan types have different interest rate ranges.

Locking Your Interest Rate

Once you have completed a loan application, determined what type of loan you want and qualified for that loan you can “lock” the interest rate for that loan. Locking the Interest Rate means, for the period of the “lock” you are guaranteed that interest rate. Lock periods are typically 15, 30 or 60 days, although you may be able to get an extended lock period.

Rate LockOnce you lock your interest rate:

If you do not close on the loan before the lock period expires, you will NOT have a guaranteed interest rate anymore. And, the longer the lock period, the higher the rate will be. For example, a 15 day lock may be at 5.125%, a 30 day lock at 5.25%, and a 60 day lock at 5.375%. So, before locking your loan, be sure you are not locking for too long a time or for too short a time.

Interest rates fluctuate daily and may go up or down. By locking your rate, you are betting that rates will go up in the future.

 What does “Buying Down” the Interest Rate Mean?

You can reduce the interest rate on your mortgage by paying “points” at closing. A point is 1% of the value of the loan, so a point on a $200,000 loan is $2,000. If you “buy down” you loan to a lower interest rate you will have lower monthly payments and pay less interest over the life of the loan. However, “buying down” you loan to a lower interest rate means more money out of your pocket on the front end when you close the loan. You should do the math and weigh each side of the equation before making a decision about buying down the interest rate or not.

What Are The Closing Costs and Fees?

Closing CostsThere are four types of closing costs and fees…

Those charged by the mortgage company and/or mortgage broker, those charged by 3rd party vendors, those charged by the Title Company, Escrow Company or Escrow Attorney and Pre-Paid Charges.

Lender Fees

These can include loan origination fees and Broker fees which are usually a percentage of the loan amount; administrative fees and application fees, processing fees and underwriting fees. These last fees usually run from $100 to $500, and ALL of them are negotiable.

3rd Party Vendor charges

These are charges collected by the lender and paid to outside companies that provide a service. These are not usually negotiable and can include appraisal charges, flood certification fees, courier charges, document prep fees, mortgage lender attorney fees, etc.

Title Company charges

These are the fees charged by the Title Company, Escrow Company or Escrow Attorney. They are usually set by the state and are not negotiable. These charges include title insurance, attorney fees, state/county/city registration fees, etc.

Pre-Paid Charges

If the lender will be establishing an escrow account to pay taxes and insurance, the buyer will pre-pay taxes and insurance to establish an escrow account and will pre-pay the interest on the loan until the end of the month in which the loan closes.

 Does The Closing Date Really Matter?

The day you choose to close determines the amount of pre-paid interest you will have to pay. Closing at the end of the month means that you will pay less pre-paid interest. For example, if you close on October 1st you will pay 31 days of pre-paid interest. If you close on October 31st you will pay 1 day of pre-paid interest.

When Is My First Payment Due?

It doesn’t matter what day of the month you close on, you will not have your first loan payment due until a month has passed. So, if you close in October, your first payment is due in December – you get November for free!

What Is PMI?

pmi-basics1Private Mortgage Insurance (PMI) is required on all loans that have a LTV greater than 80%. PMI is an insurance premium that you pay every month as part of your monthly payment. However, PMI is not intended to protect you. PMI is insurance coverage that protects the mortgage lender against default on the loan. If you stop making your payments, the mortgage lender is paid a percentage of the loan amount (usually 25% to 35%) by the insurance company.

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Customer Testimonials

We just moved here the first of January in 2017 from Ohio to the Louisville, KY area and we found Joel’s website online. He was quick to respond to us and got back the same day on our loan approval. He was very knowledgeable about the local market and kept us up-to date throughout the loan process and was a pleasure to meet at closing. Would recommend his services.

Angela Forsythe

“We were searching online for mortgage companies in Louisville, Ky locally to deal with and found Joel’s website, and it was a godsend. He was great to work with, and delivered on everything he said he would do. I ended up referring my co-worker at UPS, and she was very pleased with his service and rates too. Would definitely vouch for him.” September 2016

Monica Leinhardt

“We contacted Joel back in July 2011 to refinance our Mortgage and he was great to work with. We contacted several lenders locally and online, and most where taking almost 60 days to close a refinance, Joel got it done in 23 days start to finish,I would definetly recommmend him. He got us 3.75% with just $900 in closing costs on our FHA Streamline loan.

Kayle Griffin

“Joel is one of the best Mortgage Brokers I have ever worked with in my sixteen years in the real estate and mortgage business.” May 25, 2010

Tim Beck

“Joel has always worked very hard to keep his word and to work out seasonable solutions to difficult problems. He is truly an expert in FHA and other type loans.”

September 1, 2010 Nancy Nalley
“I have worked with Joel since 1998. He is a great loan professional.” I refer most of my Louisville, Kentucky area home buyers to him and he always take special care of them.

August 23, 2012 Jon ClarK

“Joel Lobb is a real professional in the lending industry, with many years of experience, he is the one to go to for any mortgage lending needs.” August 22, 2011

RICHARD VOLZ , Residential Sales , Remax Foursquare Realty
“When looking to purchase our new home in 2006, I had the pleasure of meeting Joel Lobb. Not only was he personable and easy to reach, he was extremely knowledgeable in his field and made sure to find us the best rate and a top notch mortgage company. We were able to complete the process in less than 3 weeks with his expertise. I find Joel to have the utmost high integrity and I recommend him to anyone who say’s they are need of mortgage assistance. He is also fantastic and keeping everyone up to date on the latest in the housing industry through his twitter posts. He provided great results for our family and we still communicate to this day!”

August 21, 2010
Stacie Drake

 

“We first use Joel on our new home purchase in 2007 in St Matthews, Kentucky area and he was great to work with. We have since refinanced our home with him in 2010 when rates got really low and he has always delivered on what he says. I could not imagine using anyone else.”

Melody Glasscock March 2014

 
Absolutely Amazing!! I emailed Joel after I had just got a denial from a bank and just thought i would try to get some advice on what my next steps would be to get a house. I honestly didn’t expect to even get a reply because my credit is not great. That was about a week and a half ago. I just signed a contract on a house last night. ONLY because of Joel Lobb. He even worked with us throughout the weekend, which shocked me. Best decision I have ever made. THANK YOU SO MUCH FOR WORKING WITH US THROUGHOUT THE ENTIRE PROCESS.
Cee Bellisle August 2017

Contacted him about buying a home and he was great to work with. I was moving to Louisville Ky to take a new job and he walked me through the entire process. He explained to me all the different options for FHA, VA, USDA mortgage loans and credit score requirements versus Fannie Mae. Since I was a first time home buyer I needed alot of help and guidance. I would definitely recommend him. Fast to respond and available to answer questions that I or my realtor had after hours.

 

Anderson Johnson April 2018

 

 

We moved from Michigan to Northern Kentucky area and we were really impressed. We got a USDA loan no money down and closed in less than 3.5 weeks. We shopped around online with other lenders but Joel was always first to respond and his rates were just a little better than other lenders. He kept us informed through the process along with our realtor and there was absolutely no surprises like we heard from other co-workers and friends that they experienced in their loan process. We have already referred another co-worker to Joel . He’s AWESOME!

Patty Kingston June 2018

 

2018 Kentucky First Time Home Buyer Loan Programs


36975873_406406043186470_8691095966767382528_ovia 2018 Kentucky First Time Home Buyer Loan Programsunnamed

Kentucky VA Mortgage Frequently Asked Questions


via Kentucky VA Mortgage Frequently Asked Questions

Louisville Kentucky VA FIXED PROGRAM GUIDELINES


via Louisville Kentucky VA FIXED PROGRAM GUIDELINES

 

Down Payment And Closing Cost Assistance Kentucky Housing HHF DAP Funds 


KHC Loan Programs

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MRB

  • All MRB Kentucky Housing first mortgage loans are for a 30-year term at a fixed rate of interest.
  • The home you purchase through Kentucky Housing must be the only residential property you own and you must occupy the home as your principal residence while the loan debt is still outstanding.
  • To qualify, you must meet KHC’s regular MRB income guidelines, make a down payment or qualify for down payment assistance, be a US citizen or legal alien and have an acceptable credit history.
  • Some MRB KHC loans are subject to a federal recapture tax. Recapture is a federal income tax that the borrowers may have to pay if they have considerable growth in their income and they sell or transfer their KHC-financed home within 9 years.  However, KHC has implemented a Recapture Tax Guarantee Program for all loans that close after October 1, 2006.  The Recapture Tax Guarantee Program will reimburse homeowners if they are subject to pay the Federal Recapture Tax on their KHC mortgage loan upon the sale of their home.

Conventional

  • Insured by approved mortgage insurance company.
  • Minimum credit score of 660 or better.
  • Quick turnaround time, 20 percent down payment and no up-front or monthly mortgage insurance.

FHA

  • Insured by the Federal Housing Administration.
  • Down payments as little as 3.5 percent.
  • Can use DAP for 3.5 percent down payment requirement.
  • Upfront and monthly mortgage insurance.
  • Minimum credit score of 620.

VA

  • Guaranteed by the Veterans Administration for qualified military veterans.
  • No down payment if the property appraises for the sale price or greater.
  • Credit underwriting is flexible.
  • Minimum credit score of 620.
  • No monthly mortgage insurance payments.

RHS

  • Guaranteed by Rural Housing Services (RHS).
  • Home must be located in a rural area as defined by RHS.
  • No down payment if the property appraises for the sale price or greater.
  • Minimum credit score of 620.

GNMA Secondary Market

  • All GNMA KHC first mortgage loans are for a 30-year term at a fixed rate of interest.
  • The home you purchase through KHC must be occupied as your principle residence while the loan debt is outstanding.
  • To qualify, you must meet KHC’s GNMA income guidelines, make a down payment, or qualify for down payment assistance, be a U.S. citizen or legal alien and have an acceptable credit history.

FHA

  • Insured by the Federal Housing Administration.
  • Down payments as little as 3.5 percent.
  • Can use DAP for 3.5 percent down payment requirement.
  • Upfront and monthly mortgage insurance.
  • Minimum credit score of 620.

VA

  • Guaranteed by the Veterans Administration for qualified military veterans.
  • No down payment if the property appraises for the sale price or greater.
  • Credit underwriting is flexible.
  • Minimum credit score of 620.
  • No monthly mortgage insurance payments.

RHS

  • Guaranteed by Rural Housing Services (RHS).
  • Home must be located in a rural area as defined by RHS.
  • No down payment if the property appraises for the sale price or greater.
  • Minimum credit score of 620.
Two FHA Refinance Options
  • Credit qualifying Streamline Refinance and Rate/Term Refinance
    • Insured by the Federal Housing Administration
    • Cash back to borrower not to exceed $500
    • Upfront and monthly mortgage insurance
    • Minimum credit score of 620

Home Buyer Tax Credit

KHC’s Home Buyer Tax Credit is available through Mortgage Credit Certificates (MCC), which reduce the amount of federal income tax you pay, giving you more available income to qualify for a mortgage loan.  MCCs are NOT mortgages.  They are tax credits that put extra cash in your pocket each month, so you can more easily afford a house payment.  That means fewer tax dollars will be withheld from your regular paycheck, increasing your take-home pay.  The federal government allows every homeowner an income tax deduction for all the interest paid each year on a mortgage loan.  But an MCC gives you a tax credit of 25 percent (not to exceed $2,000).  You can still deduct the remaining 75 percent interest on your income taxes.  A tax credit is not the same as a tax deduction.  A tax deduction reduces the portion of your income that is taxed, so you pay less.  A tax credit is a direct, dollar for dollar reduction in the total tax you owe.  The MCC is effective for the life of the loan as long as you live in the home.  If you sell your home in the first nine years of ownership, you may be subject to Federal Recapture Tax.  One-time fee of $500 or reduced to $200 if through KHC’s GNMA Secondary Market First Mortgage Program.  Not valid with MRB loan programs.

Special First Mortgage Loan Programs

The Lottery for Special Funding is opened once a year.  The funds are allocated for persons meeting income and all MRB Guidelines.  These limited funds are available, usually in July, on a first-come, first-served basis.
Guidelines
  • Must be a first time home buyer, unless property is located in a targeted county.
  • Interest rate fixed at 3.00 percent based on minimum ratios 29/41 percent.
  • Eligible households:
    • Single parents (at least one dependent under the age of 18 must live in the home.)
    • Households with a person who has a permanent disability and who receives some form of disability income (SSI, SSDI, Veterans Disability etc.).
    • Households where at least one of the home buyers is age 62 or older.
  • Gross Annual Household Income guidelines:
    • $28,000 for a household of 1 or 2 people; or
    • $33,000 for a household of 3 or more people.
  • All household occupants (18 years and older) with income must be included on loan and be credit ready.
  • Must use all but two months’ reserves of borrower’s own funds.
  • Existing or new construction property with a purchase price limit of $115,000
  • Zero Point Rate
  • Only FHA, VA and RHS – 620 credit score and AUS Approval
  • 60 Day Lock
  • Kentucky Housing’s Regular and HOME DAP loan program may be used for down payment and closing cost assistance.
Applying for a Kentucky Housing loan is easy. Just contact one of our approved lenders near you and ask for a Kentucky Housing loan.
http://www.emailmeform.com/builder/form/0bfJs9b6bK8TGoc6mQk9hIu
 
 
 
 
 

Down Payment Closing Cost Assistance

KHC recognizes that down payments, closing costs, and prep​aids are stumbling blocks for many potential home buyers. Here are several loan programs to help. Your KHC-approved lender can help you apply for the program that meets your need.

Not Available – Hardest Hit Fund (HHF) DAP

  • Zero percent interest rate for first-time home buyers.
  • A non-repayable second mortgage for $10,000.
  • Forgiven after five years.
  • Home purchase must be located in Christian, Hardin, Jefferson, or Kenton counties.
  • New construction properties are not allowed.
    • ​Property has to have been previously occupied
  • Applicants must meet Secondary Market or MRB Income and Purchase Price Limits based on funding source.

Regular DAP

  • Purchase price up to $301,294 with Secondary Market or $271,164 with MRB.
  • Assistance in the form of a loan up to $6,000 in $100 increments.
  • Repayable over a ten-year term at 5.50 percent. A DAP of $6,000 over ten years at 5.50 percent interest would equal a payment of $65.12.
  • Available to all KHC first-mortgage loan recipients.

Affordable DAP

  • Purchase price up to $301,294 with Secondary Market or $271,164 with MRB.
  • Assistance up to $4,500.
  • Repayable over a ten-year term at 1.00 percent.
  • Borrowers must meet Affordable DAP income limits.

More about down payment and closing costs

  • No liquid asset review and no limit on borrower reserves.
  • Specific credit underwriting standards may apply to down payment programs.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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

http://www.nmlsconsumeraccess.org/
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#57916 http://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.

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Source: http://www.mylouisvillekentuckymortgage.com/2012/08/khc-loan-programs.html

How to get a Kentucky VA Home Loan Eligibility Requirements answered?


via VA Home Loan Eligibility Requirements

 

VA home loans can be used to:
– Buy a home, a condominium unit in a VA-approved project
– Build a home
– Buy a manufactured home and/or lot
VA Home loan is a government guarantee for a portion of the home loan, it is not a guarantee that you will receive a loan.  You still need to have:
Suitable Credit.  Due to the government guarantee for a portion of the loan, this allows lenders greater flexibility on credit scores.  In today’s lending climate, most VA lenders require a score of at least 620. If your spouse will be obligated on the loan, he or she will need to hit the same benchmark.
The average FICO score for VA borrowers is 708, compared to 750 to 770 scores for conventional loans backed by Fannie Mae and Freddie Mac, respectively,
Sufficient Income to qualify for the amount you are requesting.
In order to apply for the VA Loan one needs to get  ” A certificate of Elgibilty” This verifies to the lender that you qualify for a VA backed home loan.
Many lenders will help get the Certificate for you or you can apply for it online by going to the veterans affairs portal. You will need your DD 214 or if you are still on active duty  you will need a statement of service.
The home that is being purchased must be occupied by the veteran/active duty member.
Veteran Must have been discharged under conditions other than dishonorable and meet the service requirements below
Each era has its own specific requirement, so be careful to match your service dates with  eligibility requirement.
If one is still on active duty or are currently serving in the Reserve or national guard the below are the requirements.
If one is on active duty in order to qualify you need to have served at least 90 continuous days
As a Reservist or National Guard member one needs to have at least 90 days active duty.  Another way to become eligible is to have served at least 6 years as a reservist or national guardsman and been honorably discharged. There are several other ways that one can qualify as outlined  below.
 VA website has more detail eligibility guidelines.  go to benefits.va. gov
The VA Home Loan program is one of the better benefits we as veterans receive. I should know, I have used this program to purchase my own home.
This is just one in series of information videos that details the VA Home Loan Program. I hope that the information in this one has been helpful.
As Always, If you have any questions, regardless of your location feel free to call or contact me.  Thank you and God Bless.
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