Repair Escrows for Kentucky USDA, FHA, VA, Fannie Mae Home loans


via Repair Escrows for Kentucky USDA, FHA, VA, Fannie Mae Home loans

 

Repair Escrows for FHA, USDA, VA and Fannie Mae Mortgage Loans in Kentucky
When are repair escrows allowed for a FHA, VA, USDA and Fannie Mae Loan in KY?
  • Agency owned properties (FHA, Fannie, VA, or RHS owned)
  • New Construction seed and sod (depending on weather conditions)
  • Energy Efficient Mortgages (EEM’s are only for FHA and VA loans)
When are repair escrows not allowed?
  • Voluntary improvements to the home unrelated to EEM’s
  • If the nature of the repair impacts the safety, structural integrity, or livability of the property
How much can you escrow for repairs?
  • $5,000 which must include the cushion
  • $6,000 for EEM’s which much include the cushion
  • $11,000 for FHA REO properties which must include the cushion
  • For FHA loans a 10% cushion must be added to any repair amount being escrowed
  • For all other loan types a 50% cushion must be added to any repair amount being escrowed
  • Be sure to include the cost of a 442 Certification on your LE
  • Agency Maximum LTV/CLTV and loan limits must still be followed
What is the process for a loan with repair escrows?
  • A Repair Escrow Agreement (found under forms in our AllRegs guidelines) detailing the terms of the repair must be filled out and provided to underwriter prior to clear to close
  • An estimate for all the repairs must be provided prior to clear to close unless the property is a HUD REO.   For HUD REO’s we require that the property manager provide either the FHA REO Appraisal, the Repair Escrow Addendum, or the Property Condition Report
  • The funds for the repair escrows will be withheld from the wire and place in a non-interest bearing escrow account

Getting a Mortgage loan in Kentucky again after A Chapter 7 or Chapter 13 Bankruptcy.


via Getting a Mortgage loan in Kentucky again after A Chapter 7 or Chapter 13 Bankruptcy.

Bankruptcy Guidelines for Fannie & FHA
Bankruptcy Chapter 7
FHA
  • 2 years from the discharge date for DU approval.   Case number assignment cannot be ordered until wait period has elapsed
  • Manual underwrites are allowed on a refer/eligible DU finding as long as 2 years has elapsed from the discharge date and the borrower has either re-established good credit or chosen not to incur any new credit obligations
  • Exception for 2 year wait period:
  1. An elapsed period less than 2 years but no less than 12 months may be acceptable
  2. The borrower must document the bankruptcy was caused by extenuating circumstances beyond their control such as a serious illness or death of a wage earner
  3. The borrower must document an ability to manage their financial affairs in a responsible manner
  4. Divorce, loss of a job, or inability to sell a home after relocation is not an acceptable extenuating circumstance
Bankruptcy Chapter 13
FHA
  • 2 years from the discharge date for DU approval.   Case number assignment cannot be ordered until wait period has elapsed
  • Manual underwrites are allowed 1 day after discharge date or at least 12 months of the payout period under the bankruptcy has elapsed at the time of case number assignment
  1. Must receive a refer/eligible DU finding
  2. Must have documentation of 12 months satisfactory payment history
  3. Must have written permission from trustee to enter into new mortgage transaction

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

fax:            502-327-9119
email:
          kentuckyloan@gmail.com