Title Insurance Information


Stewart Title Guaranty Companytitle reportSenior LoanLouisville, KYinsurance policiesinsuredchain of titlehome ownerLeaseholdLoan OfficerHurstbournelegal descriptionproperty

Source: Title Insurance Information

Infographic: History of Mortgage Rates


 

Kentucky FHA, VA, KHC, USDA, Rural Housing, Fannie Mae Mortgage Rates for 2014

Infographic: History of Mortgage Rates.

What Credit Score do You Need to qualify for a FHA VA KHC USDA Kentucky Mortgage


 

What Credit Score do You Need to Buy a Home?

Call me today for a free credit report–502-905-3708 or email me at kentuckyloan@gmail.com

When it comes to mortgages and credit scores, there are two really important questions to ask:

–What credit score do I need to qualify for a mortgage?

–What credit score do I need to get the lowest interest rate on a mortgage?

These different but related questions are important if you are looking to buy a home. And the second question is particularly important. With a high FICO score, you can literally save tens of thousands of dollars in interest over the life of a home loan. So let’s take a look at both questions. And if you don’t know you score, be sure to get you free credit score.

What credit score do you need to qualify for a mortgage?

The first thing to keep in mind is that qualifying for a mortgage involves a lot more than just a credit score. While your FICO score is a very important ingredient, it is just one factor. Lenders also look at your income and level of debt, among other things.

As a rule of thumb, however, a credit score below 620 will make buying a home very difficult. A FICO score below 620 is considered sub-prime. In the past there were mortgage companies that specialized in sub-prime mortgages. Because of the challenges in the credit market over the last year or so, however, sub-prime loans have become difficult if not impossible to obtain.

A FICO score between 620 and 650 is considered fair to good credit. But keep in mind, this range of credit scores does not guarantee you will qualify for a mortgage, and if you do qualify, it won’t get you the lowest interest rate possible. Still, to buy a home aim for a score of at least 620, recognizing that other factors weigh in the decision and that some banks may require a higher score.

What credit score do you need to get a low rate mortgage?

It use to be that a score of about 720 would yield the lowest mortgage rates available. Today, the best rates kick in with a FICO score of 760. And interest rates go up significantly as your credit score drops. To give you an idea, the following table shows current rates by credit score and calculates a monthly principal and interest payment based on a $300,000 loan:

Eligibility Requirements  for a Kentucky  FHA Loan after September 15, 2015

When applying for eligibility for A Kentucky  FHA Loans, There are some factors taken into account:
  • Credit score 620 and above with the mortgage investors we work with, even though FHA will insured lower credit scores, most mortgage lenders will create overlays
  • No bankruptcies (Chapter 7) in last 2 years with clean credit afterwards and 3 years after a foreclosure or short sale
  • 3.5% Down payment. Can be gifted or money saved-up or money taken out of 401k or retirement account. No cash gifts or unsourced deposits are allowed for down payment on a FHA loan.
  • Debt to income ratios can be up to 55% on an Approved Eligible Files but restricted on manual underwrites to 31% and 43% respectively.
  • Overtime or bonus income needs to show a 2 year history for it be eligible for income qualifying on a FHA loan. FHA underwriters typically will take a 2 year average.
  • FHA appraisals with the new changes now call for the FHA appraiser to check and review the home more thoroughly, hence the typical costs of a FHA appraisal has gone from $325 to $425 due to more legwork involved on a FHA appraisal.
  • Any disputes on credit bureau will need to be taken out of dispute status typically for your credit scores to be validated, so please be aware of this.
  • Rent references are usually not called for unless your file get downgraded to a manual
  • FHA mortgage insurance the upfront and annual mi monthly fee is for life of loan.
  • A lender may approve a borrower if:  acceptable payment history and  no major derogatory credit on revolving accounts in the last 12 months. “Acceptable payment history” means:  the borrower made all housing and installment debt payments on time for the previous 12 months, and  there are no more than two 30‐day late mortgage or installment payments in the last 24 months. “Major derogatory credit” means:  payments made more than 90 days after the due date, or  3 or more payments made more than 60 days after the due date.
  •  Child support income is Allowed If using a voluntary payment agreement, the lender:  obtains 12 months canceled checks, deposit slips, or tax returns.  For divorce decree, legal separation agreement, or court order if there is evidence of receipt for the most recent 6 months, may use the current payment to calculate income, &  if there are not 6 months of consistent payments, may average the income received over the prior 2 years, or less if the income has not been received that long  4000.1 II.A



Joel Lobb
Senior  Loan Officer
(NMLS#57916)
text or call my phone: (502) 905-3708
email me at kentuckyloan@gmail.com
The 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). Mortgage loans only offered in Kentucky.
All loans and lines are subject to credit approval, verification, and collateral evaluation and are originated by lender. Products and interest rates are subject to change without notice. Manufactured and mobile homes are not eligible as collateral.
Co-branded Daily Rate Report for:
joel lobb
Louisville Mortgage Group
License:  NMLS# 57916
I specialize in Kentucky FHA, VA, USDA, KHC, Jumbo and Fannie Mae mortgage loans in Ky. I have helped over 589 Kentucky families buy their first home and refinance their current mortgage for a lower rate; For the first time buyer with little money …view more
Email Me | Visit My Website
(502) 905-3708
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Louisville Kentucky Jumbo Mortgage Loans


Qualifying for a Jumbo Mortgage in the Post Boom Era

Qualifying for a Jumbo Mortgage in the Post Boom EraYour Jumbo Mortgage Solution

Louisville Kentucky Jumbo Mortgage Loans

Louisville KY Jumbo loans are any loans over $417,000. With jumbo loans you typically have to put down 20% or more. Jumbo loan option include 30 and 15 year fixed or 3, 5, 7 year ARMS. Jumbo loans start over $417,000, but can go up to the multi-million dollar range. As the loan amount goes up, the percentage you have to put down goes up.
These loans often require the borrower to have high credit scores and plenty of reserves. The borrower also has to be willing to help us document their income. The stated income options of yesterday are long gone. If you are a business owner, you will now have to provide tax returns to prove income.
Typically Jumbo loans have higher rates than conforming loans under $417,000. This is because jumbo loans carry a lot more risk to lenders. Jumbo loans are associated with luxury homes which can take longer to sell and can be prone to large valuation shifts. Jumbo loans and higher-end homes have come under more scrutiny with the lower market values and the associated difficulties with appraising luxury homes. In the current mortgage environment fewer lenders are offering jumbo loans and super jumbo loans.
So, if you are in the market for a jumbo loan, here are the new rules:
• A down payment, or, if refinancing, equity, of (usually):
• At least 20% down for jumbos up to $1 million
• At least 30% down up to $2 million
• More for loans over $2 million
• An excellent credit score (at least 720 but could be more as some banks report that their average jumbo customer has a credit score in the 760s)
• Income documentation and verification. Borrowers are now required to provide financial records verifying that they earn what they say they earn (some borrowers have been asked to provide two years of their income history).
• Expect to obtain an adjustable-rate loan; fixed-rate jumbos are relatively rare.
• DTI (Debt-to-Income) of less than 38 percent. That means a borrower’s monthly mortgage payment must be less than 38 percent of their income before taxes. The ability to afford to make monthly payments is critical in the jumbo loan market.
Be prepared to shop around. Depending on what part of the country you are in, lenders can have different jumbo loan lending guidelines. Guidelines may also vary depending on the type of dwelling (condo vs. house), whether it is a primary home or investment property (some lenders will only approve jumbo loans for primary residences; others will grant jumbo loans for vacation homes or investment properties).
Jumbo loans are not commodities. Today, most jumbo loans come from the big banks that are keeping loans on their books instead of selling them. Falling property values are still a concern, but with jumbo loans requiring a lower loan-to-value ratio, even if housing prices dropped sharply, the risk to the bank is low.
Since interest rates on deposits are currently low, the bank makes money by charging higher interest rates on mortgages than they pay on their customers’ deposits, thereby profiting on jumbo mortgages, even when the mortgage is offered at a low rate. However, keep in mind that rates paid on deposits will someday rise again. Banks are promoting jumbo ARMs whose rates will rise when rates paid on deposits go up. The most popular jumbos are 5/1 ARMs, which have an introductory rate that lasts five years; then adjust annually thereafter.
Income requirements are high
Lenders of jumbo mortgages take a risk. If a jumbo mortgage loan defaults, it can be hard to sell the property quickly for a good price. Luxury properties are generally more subject to the vagaries of the marketplace than are ordinary properties. Therefore, borrowers taking a jumbo mortgage must prove their financial responsibility and reliability
Having a high income demonstrates an ability to support mortgage payments. In order to qualify for a jumbo mortgage, you will have to have a low debt-to-income ratio that allows you comfortably to pay the principal, interest, taxes and insurance each month. As a rule, your monthly mortgage payment on a jumbo loan should not exceed 38 percent of your pre-tax income.
Be prepared to present proof of your income. Jumbo borrowers typically have to fully document two years of income history. Show your shining credit score  A good credit score is essential to qualify for a jumbo mortgage. Required scores vary according to lender, but expect to need a score of at least 720. Be aware that lenders will look at credit reports from all three major credit bureaus, so any history of missed payments is sure to impact.  Down payment requirements are demanding  Again, due to the risk the lender takes, down payment requirements for jumbo loans are strict. It is rare to find a lender who will accept less than 20 percent of the home cost as a down payment. Many lenders expect at least 30 percent, especially for very expensive properties.
Not all properties qualify  Although each lender is different, many will not offer jumbo loans on vacation homes and investment properties. Refinancing a jumbo loan can be problematic in a weak economy. If house prices fall, borrowers of jumbo loans might suddenly find that they do not have 20 percent equity in their homes. Thus, they do not qualify to refinance.
Joel Lobb (NMLS#57916)Senior  Loan Officer
502-905-3708 cell
502-813-2795 fax
jlobb@keyfinllc.comKey Financial Mortgage Co. (NMLS #1800)*
107 South Hurstbourne Parkway*
Louisville, KY 40222*

The Best Kind of Loan for Your Credit Score


The Best Kind of Loan for Your Credit Score.

Overview of the Kentucky VA Home Loan Program


English: Equal Housing Lender emblem

Overview of the Kentucky VA Home Loan Program

Topics on This Page:

Who’s Eligible Size of the Loan Steps in the Process
How It Works Your Costs Useful Links
What It Can Do for You Basic Requirements

 Who’s Eligible

  • Veterans
  • Active duty personnel
  • Certain reservists and National Guard members
  • Surviving spouses of persons who die on active duty or die as a result of service-connected disabilities
  • Certain spouses of active duty personnel who are (a) missing in action, (b) captured in line of duty by a hostile force, or (c) forcibly detained by a foreign government or power

More on Eligibility

How It Works

You get your loan from a private lender, and  VA “stands behind” the loan with that lender. If something goes wrong and you can’t make the payments anymore, the lending institution can come to us to cover any losses they might incur. The VA loan guaranty is this “insurance” that we provide the lender.

Most loans are handled entirely by lenders. VA rarely gets involved in the loan approval process.

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What It Can Do for You

Here are some advantages of the Kentucky VA program:

  • You can buy a home without a down payment – as long as the sales price doesn’t exceed the appraised value. (Of course, you have to qualify in terms of income and credit.)
  • You won’t need to buy private mortgage insurance.
  • VA rules limit the amount you can be charged for closing costs.
  • Closing costs may be paid by the seller. (You should keep this in mind when negotiating the sales price.)
  • The lender can’t charge you a penalty fee if you pay the loan off early.
  • VA may be able to provide you some assistance if you run into difficulty making payments.

You should also know that

  • You don’t have to be a first-time homebuyer.
  • You can reuse the benefit.
  • VA-backed loans are assumable, as long as the person assuming the loan qualifies.

Size of the Loan

VA doesn’t specify a maximum loan amount. But the law does set limits on the amount of liability we can assume. This usually affects the amount of money an institution will lend you.

The lender may be able to increase the size of the loan if you can make a down payment.

Information on Loan Limits

When the lending institution is deciding how big a loan you can afford, it uses either of two methods:

  • One Method is the “residual income calculation.” The lender adds up your routine housing expenses, taxes, and additional debt payments such as your car and credit cards. He or she subtracts this total from your income. Then the lender decides whether you’ll have enough money left over for everyday living.
  • The second method is the debt-to-income ratio. Under VA’s rules, this is the ratio of your total debt (both housing and other debt) to your income. For more information on how lenders use these tools to complete a Loan Analysis, visit the VA Lender’s Handbook, Chapter 4, Topic 9.

This is just a thumbnail sketch. A VA-approved lender is the best resource to see how large a loan you qualify for. In making a decision, the lender must look at income (amount and stability), credit, and “compensating factors.” Lenders may use certain automated systems to help with their decisions.

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Your Costs

The VA Funding Fee. Although we don’t require private mortgage insurance we do charge a funding fee. (This can be folded into the loan.) If you receive service-connected disability payments each month, you’re exempt from the fee. For more information on the VA Funding Fee and who is exempt, visit theLender’s Handbook, Chapter 8, Topic 8.

Information on Funding Fees

Other Costs of the Loan. Other costs will be involved. Of course, the lender charges interest. And some other fees and charges have to be paid at closing. Here are some general rules:

  • The lender, not VA, sets the interest rate, the “discount points,” and closing costs. These rates may vary from lender to lender.
  • The seller can pay for some closing costs. (Under our rules a seller’s “concessions” can’t exceed 4% of the loan. But only some types of costs fall under this 4% rule. Examples are: payment of pre-paid closing costs, VA funding fee, payoff of credit balances or judgments for the veteran, and funds for temporary “buydowns.” Payment of discount points is not subject to the 4% limit.)
  • You’re not allowed to pay for the termite report, unless the loan is a refinance. That fee is usually paid by the seller.

Basic Requirements

  • You must live in the home as your primary residence.
  • You must qualify in terms of income and credit. You could be turned down if you’ve had problems with credit or your income is not considered stable.

Steps in the Process of Getting a VA Home Loan

Getting a VA-backed loan – or any home loan – takes some time. The process has a few steps. Click on the link for more information:

Steps in Getting a VA Home Loan

If you have any questions during the process that the lender can’t answer to your satisfaction, please contact VA at your regional loan center.

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Useful Links:

  • Ginnie Mae (The Government National Mortgage Association) – This site will give you information on the process and calculators
  • HUD (The Department of Housing and Urban Developement) – Contains information on shopping for a home, closing costs and terminology
  • MBA (Mortgage Bankers Association of America) – Will give you information on the purchase process, calculators and real estate terms.
  • Freddie Mac (Federal Home Loan Mortgage Corp.) – Site will give you information about the purchase process.
  • FNMA (Fannie Mae) – Contains information on the purchase process.

Kentucky VA Loan Refinance and Purchase Guidelines


 

How do I refinance using my Kentucky VA Home Loan?

You can use your Kentucky VA home loan benefit to refinance your existing VA home loan to a lower

interest rate, with little or no out-of-pocket cost. This is called an Interest Rate Reduction

Refinancing Loan (IRRRL), also known as a “rapid refinance” or a “streamline refinance.”

Generally, no appraisal, credit information, or underwriting is required for this refinancing

option, although some lenders may require an appraisal and credit report. The fees and

charges associated with the refinancing loan may be incorporated into the new VA loan.

Remember: The interest rate on the new loan must be lower than the rate on the old loan

(unless you refinance an adjustable-rate mortgage to a fixed-rate mortgage).

To receive an IRRRL, work with your lender to process your application. It’s generally a good

idea to compare several lenders’ rates first, as there may be large differences in the terms

they offer. Also, some lenders may contact you suggesting that they are the only lenders

with the authority to make IRRRLs, but according to VA, any lender can

make you an IRRRL.

An IRRRL can be done only if you have already used

your eligibility for a KentuckyVA loan on the property you intend to

refinance. If you have your Certificate of Eligibility, take it

to the lender to show your prior use of the entitlement.

The occupancy requirement for an IRRRL is different from that for

other VA loans. When you originally got your Kentucky  VA loan, you certified

that you occupied or intended to occupy the home. For an IRRRL, you

need only certify that you previously occupied it.

The loan may not exceed the sum of the outstanding balance on the existing VA loan,

plus allowable fees and closing costs, including the funding fee.

What’s the Cash-out Refinance Option?

The Veterans’ Benefits Improvement Act of 2008 allows you to free up cash with a cash-out

refinance, a VA home loan refinance program in which you can cash-out on the equity you

have built up in your home. As an example, if you still owe $70,000 on your original loan, you

can refinance for a $90,000 loan, which gives you a cash-out of $20,000.

An appraisal is required and you must qualify for the loan. If you are refinancing for the first

time, VA charges a 2.15% funding fee for this program (2.15% of the total loan) which can be

rolled into the loan amount. If you refinance more than once, the funding fee is 3.3%.

There is no minimum amount of time that you must own your home, yet your home must have

sufficient equity to qualify for KEntuckyVA refinancing. Existing loans can be refinanced whether they

are in a current or delinquent status, but refinancing loans are subject to the same income

and credit requirements as regular home loans. As long as you have title to the property

you can refinance an assumed loan. Check with your lender as there are some additional

regulations concerning assumed loans.

Conventional to VA Refinance

If you do not have a KentuckyVA home loan but are eligible for one, you can refinance a subprime or

conventional mortgage for up to 100 percent of the value of the property. Usually you will be

charged a funding fee of around 2-3 percent (depending on the lender you choose) if you are

using your VA loan guarantee for the first time. Benefits to this type of refinancing are that

your new interest rate may be lower and you will have no monthly mortgage insurance or outof-

pocket closing costs.

Can I reuse my Kentucky VA Home Loan benefit?

The Kentucky VA  home loan benefit can be reused if you have paid off your priorKentucky VA loan and sold the

property. In addition you may, on a one-time-only basis, be able to reuse or restore your

benefit eligibility if your prior VA loan has been paid in full and you still own the property.

In either case, to restore your eligibility, you must send a completed VA Form 26-1880 to your

VA Eligibility Center. (See VA Loan Documents Checklist Above.)

To prevent delays in processing, you should also include evidence that the prior loan has

been paid in full and, if applicable, the property disposed of. This evidence can be presented

in the form of a paid-in-full statement from the former lender, or a copy of the HUD-1

settlement statement completed in connection with a sale of the property or refinance of the

prior loan.

Depending on the circumstances, if you have already used a portion of your VA-guaranteed

amount (up to $89,912), and the used portion cannot be restored, any remaining portion of

your VA guarantee is available for use on another loan. You will have to ask your lender if your

remaining VA-guaranteed portion will be enough, or if you will need to make a down payment

to qualify for the loan. If you have a question about your specific case, contact VA.

 

 

 

What are the advantages of a Kentucky VA Home Loan?

The following is a quick list of reasons why a Kentucky VA loan may be your best option:

No down payment required

VA funding fee may be financed in the loan

VA Loans do not require perfect credit – there is no credit score cut-off

VA funding fees may be waived for veterans with VA rated service-connected

disabilities and surviving spouses of veterans with service-connected disabilities

 

Closing costs may be shared between the buyer and lender

Flexible mortgage types – fixed, hybrid and traditional ARMs

No mortgage insurance premiums – this is huge in today’s housing market

VA guarantied mortgages are assumable

No pre-payment penalties

Homes are inspected and appraised by VA prior to approval and/or during

construction

 

VA can offer assistance to veteran borrowers in default due to temporary financial

difficulty

 

Refinance and Interest Rate Reduction loans are available

All in all, the pros far outweigh the cons. And, considering there are very few “no-down

 

payment” mortgage options around that offer lower associated fees, using your VA home

 

loan benefit seems like a no-brainer – as long as the red tape doesn’t scare you.