Tag: fha credit score

What FICO® Score Do You Need to Qualify for a Kentucky Mortgage?


It’s common knowledge that your FICO ® score plays an important role in the homebuying process. However, many buyers have misconceptions regarding what exactly is required to get the loans they need. While a recent announcement from CNBC…

Source: What FICO® Score Do You Need to Qualify for a Mortgage? – Cape Gazette

What FICO® Score Do You Need to Qualify for a Mortgage?

October 10, 2019

Different Fico Scores For a Kentucky Mortgage Loan ApprovalCredit_Score_RangesCredit Score Requirements for a Conventional loan, USDA Loan, FHA Loan, VA loan in Kentucky

It’s common knowledge that your FICO® score plays an important role in the homebuying process. However, many buyers have misconceptions regarding what exactly is required to get the loans they need.

While a recent announcement from CNBC shares that the average national FICO® score has reached an all-time high of 706, the good news for potential buyers is that you don’t need a score that high to qualify for a mortgage. Let’s unpack the credit score myth so you can to become a homeowner sooner than you may think.

With today’s low interest rates, many believe now is a great time to buy – and rightfully so! Fannie Mae recently noted that 58% of Americans surveyed say it is a good time to buy. Similarly, the Q3 2019 HOME Survey by the National Association of Realtors said 63% of people believe now is a good time to buy a home. Unfortunately, fear and misinformation often hold qualified and motivated buyers back from taking the leap into homeownership.

According to the same CNBC article,

“For the first time, the average national credit score has reached 706, according to FICO®, the developer of one of the most commonly used scores by lenders.”

This is great news, as it means Americans are improving their credit scores and building toward a stronger financial future, especially after the market tumbled during the previous decade. With today’s strong economy and increasing wages, many Americans have had the opportunity to improve their credit over the past few years, driving this national average up.

Since Americans with stronger credit are now entering the housing market, we are seeing an increase in the FICO® Score Distribution of Closed Loans.

But hang on – don’t forget that this does not mean you need a FICO® score over 700 to qualify for a mortgage. Here’s what Experian, the global leader in consumer and business credit reporting, says:

FHA Loan: “FHA loans are ideal for those who have less-than-perfect credit and may not be able to qualify for a conventional mortgage loan. The size of your required down payment for an FHA loan depends on the state of your credit score: If your credit score is between 500 and 579, you must put 10% down. If your credit score is 580 or above, you can put as little as 3.5% down (but you can put down more if you want to).”

Conventional Loan: “It’s possible to get approved for a conforming conventional loan with a credit score as low as 620, although some lenders may look for a score of 660 or better.”

USDA Loan“While the USDA doesn’t have a set credit score requirementmost lenders offering USDA-guaranteed mortgages require a score of at least 640.”

VA Loan: “As with income levels, lenders set their own minimum credit requirements for VA loanborrowers. Lenders are likely to check credit scores as part of their screening process, and most will set a minimum score, or cutoff, that loan applicants must exceed to be considered.”

Bottom Line

As you can see, plenty of loans are granted to buyers with a FICO® score that is lower than the national average. If you’d like to understand the next steps to take when determining your credit score, let’s get together so you can learn more.

 

Joel Lobb
Mortgage Loan Officer
Individual NMLS ID #57916
 
American Mortgage Solutions, Inc.
 

Text/call:      502-905-3708

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

This article is presented to you by Waterstone Mortgage. Please click here to read the full article.

How to qualify for a Kentucky FHA Home Loan ?


How to qualify for a Kentucky FHA Home Loan ?
How to qualify for a Kentucky FHA Home Loan ?

via How to qualify for a Kentucky FHA Home Loan ?

 

Kentucky FHA Loan Requirements for 2019

 

How do I qualify for an FHA loan in Kentucky?

Kentucky FHA loans allow buyers with down payments as little as 3.5% to buy a home, and with many state-sponsored down payment assistance programs like KHC or Kentucky Housing Agency down payment asssitance program of up to $6000 currently to use for your own down payment, Kentuck borrowers using FHA loans can  can get the loan with zero money down.

They’re are other down payment assistance programs in KEntucky see below:

KACO Down Payment Assistance Program

KHC Down Payment Assistance

Louisville Metro Housing Grant

Covington Kentucky Grants and Northern Kentucky Grants to Buy a Home

AFR Down Payment Assistance

Chenoa Fund Down Payment Assistance

Kentucky FHA loans allow up to a  higher debt to income ratio than conventional loans which are restricted to 45 to 50% debt to income ratio, which is much lower  than most Kentucky FHA loans. That means more Kentucky FHa  buyers can qualify for a home loan in case if  your co-borrower cannot go on the loan due to credit issues.

Do I qualify for an FHA loan in Kentucky?

They’re are many FHA Kentucky loans requirements, which can be confusing. Some lenders are tougher and will not lend even though FHA will insure the loan. So check around on your FHA loan questions

  • Buy a property you will use as your primary residence
  • Your credit score must meet the minimum requirements of the FHA and the lender (FHA requires a minimum of 500 for 10% down and 580 for 3.5% down; however, lenders often require higher minimums)
  • The property you want to buy has to meet the FHA criteria and get approved
  • Must meet debt-to-income requirements
  • Clear Cavirs number
  • 3 years removed from foreclosure sale date
  • 2 years removed from Chapter 7 Bankruptcy
  • 1 year in Chapter 13 plan with good pay history and permission from trustee

 

For a detailed explanation of the requirements, you can read the HUD handbook and check with prospective lenders.

A Complete Guide to Closing Costs

Joel Lobb
Senior  Loan Officer
(NMLS#57916)
 Company ID #1364 | MB73346

 unnamed (2) (1)

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). USDA Mortgage loans only offered in Kentucky.

All loans and lines are subject to credit approval, verification, and collateral evaluation

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.


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Latest FHA shift to mitigate risks may shut out some Kentucky home buyers wanting FHA Loans in 2019

Latest FHA shift to mitigate risks may shut out some Kentucky home buyers wanting FHA Loans in 2019


via Latest FHA shift to mitigate risks may shut out some Kentucky home buyers wanting FHA Loans in 2019

Latest FHA shift to mitigate risks may shut out some Kentucky home buyers wanting FHA Loans in 2019

Kentucky FHA Loan Changes for FICO Scores and Credit Scores for 2019

 

Last week, the Federal Housing Administration took steps to mitigate risks to its single-family portfolio, announcing updates to its TOTAL Mortgage Scorecard that may flag some loans for manual underwriting.
The change applies to all loans with case numbers assigned on or after March 18th, meaning that it is likely to affect some of the loans currently sitting in an FHA lender’s pipeline.
Chatter among members of the lending community suggests a number of originators are unhappy about the changes, fearing that the end result may be that some of their borrowers will be shut out of FHA financing.
Some said the FHA did not go about implementing the changes the right way, creating confusion about how the risk is being mitigated, while others said they felt as if the rug had been pulled out from under them, and fear that borrowers who no longer qualify will be angry, according to email exchanges between lenders and mortgage brokers, shared with HousingWire.
For its part, the FHA said it is taking necessary steps to address some of the risk trends apparent in its single-family portfolio and flagged as concerning in its 2018 Report to Congress.
Specifically, FHA loans have seen a substantial increase in cash-out refinances, a drop in the average borrower credit score, and an increase in borrowers with high debt-to-income ratios.
In its letter about the Scorecard updates, the FHA said that the number of FHA refinances that are cash-outs increased 60% in 2018, and that almost a quarter of all FHA loans in 2018 had a DTI ratio above 50%.
The average credit scores for FHA borrowers has also declined, falling to 670 in 2018 – the lowest average since 2008.
Combined, these factors are signaling untenable risk for the agency as they flag the potential for the program to drain the Mutual Mortgage Insurance Fund.
“Federal Housing Commissioner Montgomery has publicly stated numerous times in recent months that FHA must seek the right balance between managing risk and fulfilling its mission of supporting sustainable home-ownership,” the FHA said in its letter.
“To be successful long term, FHA must maintain the integrity of its insurance endorsements,” it continued. “This includes assessing the causes of the increase in higher-risk credit characteristics in the portfolio and making prudent and necessary changes to re calibrate and adjust its policies as warranted to manage credit risk.”
The agency said the updates to its Scorecard are just the first step it will be taking to address these risk factors.
“FHA will carefully monitor the impact of this change and is preparing to implement additional changes to maintain a better balance of managing risk and fulfilling its mission,” the agency stated.

 

I can answer your questions and usually get you pre-approved the same day. 


Call or Text me at 502-905-3708 with your mortgage questions.
Email Kentuckyloan@gmail.com

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
 

 

 

 

 

 

 

 

 

 

http://www.emailmeform.com/builder/form/0bfJs9b6bK8TGoc6mQk9hIu
 
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.

 

What is the minimum credit score I need to qualify for a Kentucky FHA, VA, USDA and KHC Conventional mortgage loan in 2018?


via What is the minimum credit score I need to qualify for a Kentucky FHA, VA, USDA and KHC Conventional mortgage loan in 2018?

What kind of credit score do I need to qualify for different first time home buyer loans in Kentucky?
Answer below:
Most lenders will wants a middle credit score of 620 to 640 for KY First Time Home Buyers looking to go no money down. The two most used no money down home loans in Kentucky being USDA Rural Housing and KHC with their down payment assistance will want a 620 to 640 middle score on their programs.
If you have access to 3.5% down payment, you can go FHA and secure a 30 year fixed rate mortgage with some lenders with a 580 credit score. Even though FHA on paper says they will go down to 500 credit score with at least 10% down payment, you will find it hard to get the loan approved because lenders will create overlays to protect their interest and maintain a good standing with FHA and HUD.
Another popular no money down loan is VA. Most VA lenders will want a 620 middle credit score but like FHA, VA on paper says they will go down to a 500 score, but good luck finding a lender for that scenario.
A lot of times if your scores are in the high 500’s or low 600’s range, we can do a rapid rescore and get your scores improved within 30 days.
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