- Borrowers using rental income from a non-subject property to qualify need to document a minimum 2 year rental history and 3 months reserves PITI for each rental property (excluding property being vacated and turned into a rental). When no mortgage exists on a rental property, 3 months reserves must still be provided that cover taxes, insurance, HOA dues, and any other fees documented for the property. These reserves cannot come from equity, gift funds, or any loan proceeds.
- Rental income from boarders can now be used as qualifying income provided
- A 2 year history of tax returns can be provided showing boarder income generated by the property; AND
- The use of the property for boarder rental cannot impair the residential nature of the property and cannot exceed 25% of the property’s total floor area
- Alimony, child support, and maintenance require at least 3 years continuance to be considered effective income.
- For payment plans after a judgment, VA will generally require 12 months of timely payments before credit is considered reestablished. A shorter repayment history may be considered if it can be determined that the borrower addressed the judgment responsibly and began a repayment plan immediately after it was filed. If borrower has missed payments within the last 12 months, they will be ineligible for financing even if the debt is paid in full.
- For voluntary short sales or deeds-in-lieu where the borrower was current on their payments at the time the property was surrendered, no minimum derogatory credit waiting period will be required.
- VA’s list of required Appraisal Report Contents has been updated and now includes specific photographs required on the appraisal (refer to VA Chapter 11: Topic 3: Appraisal Report Contents for full list).
- VA Chapter 11: Topic 4: Gross Living Area has been added to provide direction in determining the Gross Living Area of the property.
- Other sections have been updated to include guideline changes from previous VA Circulars.
5 Easy Steps To A Kentucky VA Loan
Apply for a Certificate of Eligibility.
A veteran who doesn’t have a certificate can obtain one easily by making application on VA Form 26-1880, Request for Determination of Eligibility and Available Loan Guaranty Entitlement, to the local VA office.
Decide on a home you want to buy and sign a purchase agreement.
Order an appraisal from VA. (Usually this is done by the lender).
Most VA regional offices offer a “speed-up” telephone appraisal system. Call the regional VA office for details. See also How To Get a VA Loan.
Apply to a mortgage lender for the loan.
While the appraisal is being done, the lender (mortgage company, savings and loan, bank, etc.) can be gathering credit and income information. If the lender is authorized by VA to do automatic processing, upon receipt of the VA or LAPP appraised valuedetermination, the loan can be approved and closed without waiting for VA’s review of the credit application. For loans that must first be approved by VA, the lender will send the application to the local VA office, which will notify the lender of its decision.
Close the loan and move in.
- Louisville Kentucky VA Refinance Loans (kentuckyvaloan.com)
- Debt To Income Ratios for a Louisville Kentucky VA Mortgage Loan(louisvillekentuckyvamortgage.blogspot.com)
- Compensating Factors to over turn a Kentucky VA Loan Mortgage Denial(louisvillekentuckyvamortgage.blogspot.com)
- FHA Changes for Mortgage Loans in Kentucky for 2013(kentuckyfirsttimehomebuyer.com)
- Mortgages and Credit Scores (louisvillemortgageguide.com)
- Kentucky Mortgage Underwriting Guidelines updated for 2013(kentuckyfirsttimehomebuyer.com)
- Kentucky Housing first mortgage loans guidelines for 2013(louisvillemortgageguide.com)
- Kentucky FHA Mortgage Guideline Changes April, 2013(louisvillemortgageguide.com)
- 2013 Kentucky FHA Mortgage Changes to Mortgage Insurance(louisvillekymortgage.net)
- Kentucky Residual Income Requirements for A VA Mortgage Loan In KY(louisvillekentuckyvamortgage.blogspot.com)
Compensating factors include, but are not limited to the following:
· excellent credit history,
· conservative use of consumer credit,
· minimal consumer debt,
· long-term employment,
· significant liquid assets,
· sizable downpayment,
· the existence of equity in refinancing loans,
· little or no increase in shelter expense,
· military benefits,
· satisfactory homeownership experience,
· high residual income,
· low debt-to-income ratio,
· tax credits for child care, and
· tax benefits of home ownership.
If you looking to get approved for a Kentucky VA Mortgage, give us a call today. We can go down to 640 credit scores for VA loans in Kentucky, and the maximum debt to income ratio on some cases can go as high as 50% with the above compensating factors.