Monday, May 22, 2017

New Kentucky USDA Rural Housing Income Guidelines for 2017 RHS Income Kentucky Guideline Updates USDA has published new income limits for Kentucky USDA Rural Housing borrowers, effective immediately. Those new limits can be found HERE.






New Kentucky USDA Rural Housing Income Guidelines for 2017




RHS Income Kentucky Guideline Updates
USDA has published new income limits for Kentucky USDA Rural Housing  borrowers, effective immediately. Those new limits can be found>>> HERE.





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Wednesday, May 3, 2017

Kentucky USDA Rural Development For 2017 Mortgage Guidelines



2017 Kentucky Rural Development Mortgage Guide

  • 30 year fixed rate only for Purchases and Existing USDA loans Refinances.
  • Zero down Mortgage loan with a loan limit of $424,000
  • Upfront funding fee is 1.0% and annual mi fee is .35% (very low compared to FHA)
  • Typically cannot own other real estate. There are exceptions to this. 
  • You do not have to be a first-time home buyer in Kentucky
  • Can refinance existing USDA loan as long as lowering rate by 1% and can do without an appraisal. There are overlays to this by lenders.
  • Closing costs and prepaids can be paid by seller but must be put into contract
  • Closing costs may be financed into the loan up to the appraised value.
  • You will need two credit trade lines reporting at least for 12 months on your credit file. They don't have to be open and active. Just reporting on your credit report.
  • All Guaranteed Mortgage Loans are ran through GUS. GUS stands for the Guaranteed Underwriting System. USDA and their underwriters use this system to pre-approve you. They review credit score/history, income, debt to income ratio and assets to determine your loan eligibility. If your credit score is below 640 or your debt to income ratio is over 45%, it will get a refer and you will find most lenders will not approve the loan. 
  • Some lenders will do a credit score down to 600, but they will want a lot of documentation to overturn the refer and compensating factors for the lower credit score. They typically will need to verify rent for last 12 months, with no lates, cash payments are not acceptable, and debt to income ratios are set at 29% and 41% respectively. Reserves are typically helpful too on lower credit scores, so keep in that in mind, if you have money in a savings account, for a rainy day fund, this will help sometimes get the loan approved.
  • If you have access to 20% down payment you cannot use the USDA Program. Money in a retirement account does not account toward the 20% rule.
  • Properties must be located in an eligible area of Kentucky. Typically the large metro areas of Kentucky including the following: all of Jefferson County,  all of Fayette County, Owensboro, Paducah, Hopkinsville, Bowling Green, Richmond, Frankfort and Northern KY cities of Covington, Florence, Erlanger, Beechwood, Richwood are not eligible

USDA Eligible Areas In Northern Kentucky for Boone, Kenton, Campbell, Grant Counties

  • Independence
  • Burlington
  • Hebron
  • Highland Heights
  • Walton
  • Alexandria
  • Cold Springs
  • All Of Grant County, Pendleton County And Owen County






Kentucky USDA Rural Max Income Limits:

  • The total household income must be within the county limits for household size.  Typically a family household of 4 can make up to around $75,650  and a family of five or more  can make up to $99,850 for a household- Some KY counties allow for higher like Shelby County, and the Northern Kentucky Counties of Boone, Kenton, Campbell allow $82,000 (household income of four) up to $108,250 (household income of five or more)



Some More Facts about a Kentucky USDA loan:

It's a two step approval process.  The chosen USDA lender must first underwrite the file and get it approved based on the income, assets, and credit report submitted. Then, the lenders must submit to USDA for a "conditional commitment".  This conditional commitment is the final loan approval paperwork you are looking for. 


Even though the lender may have approved the file, it still must go to USDA office in Lexington for an assignment to SFH underwriter for the final approval process. They typically are checking the appraisal and income at this stage. There have been instances where the lender would approve the file but USDA would not due to appraisal issues or income and job history. 
This is very rare instances, so keep that in mind when it comes to final loan approval. 
This two-step approval process usually adds 4-6 days to the final loan approval process, so keep that in mind when you are writing up your contract because it takes a little longer to close these loans vs FHA, VA, and Fannie Mae loans. 
Well Test Treatments:  Properties with a well as the primary drinking source will require a well water test.  There are local labs to perform this test and the water must pass.

Septic Test: Sometimes they will require the septic tank to be inspected if called for in the appraisal report or home inspection. 

Older Homes: As a general rule, USDA does not like homes older than 100 years old. They will sometimes require a home inspection in addition to the mandatory appraisal on older homes.
USDA Loan After a Short Sale:  A short sale is not the end of the world.  So it is very possible to obtain a USDA loan if 3 years have passed after the short sale.  But a buyer would need re-established good rent and other credit history.

Bankruptcy and Foreclosure:  If the mortgage debt that was foreclosed, was included in a Bankruptcy – then the USDA Home Loan waiting periods after foreclosure “waiting period” of 3 years, starts from the date of the discharge of the Bankruptcy.  Because it can take 6 months or more for Banks to process the Foreclosure, and transfer title, this is a tremendous plus.





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Get Qualified for a Kentucky USDA Loan Now!


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.


Kentucky Rural Development Guidelines for Pools, credit scores, debt ratios.


Kentucky Rural Development Guidelines for Pools, credit scores, debt ratios. 


1. Is the property in an eligible area? Check address at: http://eligibility.sc.egov.usda.gov
Click on ‘single family’ under the link “Property eligibility”. Type in address or go to map.

2. Is their household income within the Agency limits? See the chart. Use the fast easy
calculator at http://eligibility.sc.egov.usda.gov Click on ‘single family’ under ‘Income Eligibility’

3. Do they have reasonable credit? Your lender’s underwriter makes the credit decision. Our
streamlined processing does not require credit explanations if the FICO is 640 or higher (EXCEPT with recent  Bankruptcy in last 3 years or a foreclosure in the last 3 years). Alternate credit is acceptable. 580 and below would be rare. A 670+ score is a stand-alone  compensating factor. The lender’s underwriter makes the final decision on creditworthiness.

Do they have reasonable repayment ability? Ratios are 29/41% (31%/43% for homes built after
Jan 1, 2001) but can be waived when it makes sense.: .5% (.005) annual fee will be assessed. Rural Development is a direct guarantor. There is no mortgage insurance and the Guarantee remains at the  maximum of 90% of original principal borrowed. Fee cannot be prepaid and is billed annually to the servicing lender. Rate and Term: 30 year fixed, very competitive conventional rate


Other eligibility criteria:

.• No co-signors residing outside of the household.
• In-ground swimming pools. The loan, not including RD fee, is limited to the appraised value WITHOUT the pool. The FHA appraiser must justify value ‘as is’ AND a value as if the property had no pool. The value of the  pool must be established and justified


Joel Lobb
Senior  Loan Officer
(NMLS#57916)

American Mortgage Solutions, Inc.
800 Stone Creek Pkwy, Ste 7,
Louisville, KY 40223

 phone: (502) 905-3708
 Fax:     (502) 327-9119

 Company ID #1364 | MB73346

Wednesday, April 26, 2017

Kentucky Fannie Mae Guideline Updates On Student Loan


Fannie Mae Updates Selling Guide

Fannie Mae has announced updates to the April Selling Guide (SEL-2017-04) to include the following.  All changes but one; noted below, are effective immediately.
Student Loan Payment Calculation
  • If a payment amount is provided on the credit report, that amount can be used for qualifying purposes.
  • Note: we have confirmed with Fannie Mae that this will include income based repayment options reporting to credit that are not fully amortizing.
  • If the credit report does not identify a payment amount (or reflects $0), we can use either 1% of the outstanding student loan balance, or a calculated payment that will fully amortize the loan based on the documented loan repayment terms.
  • Note: The DU messaging when an installment debt on the loan application does not include a monthly payment will be updated in a future release to reflect this new policy. Until then, we may disregard the statement in the message specifying the previous policy and follow the new policy.
 Debts Paid by Others
  • Requirements will be simplified for excluding non-mortgage debts from the debt-to-income ratio.
  • Non-mortgage debts include debt such as installment loans, student loans, and other monthly debts as defined in the Guide.
  • If documentation is obtained that a non-mortgage debt has been satisfactorily paid by another party for the past 12 months, then the debt can be excluded from the debt-to-income ratio.
  • This policy applies regardless of whether the other party is obligated on the debt.
  • Note: The DU message on omitted debts will require documentation to support the omission of the debt, but will not reference the documentation requirements specified as DU is not able to identify if the debt was omitted as a result of the new policy.
  • This policy does not apply if the other party is an interested party to the subject   transaction (such as the seller or realtor).
  
Fannie Mae Student Loan Cash-out Refinance Features
LLPA is waived for loans that meet the student loan cash-out refinance requirements.
Features
Requirements
Requirements Shown are New or Aligns with C/O or LCO Guidelines
Student Loans Eligible for Payoff
  • At least one student loan must be paid off. Loan proceeds must be paid directly to the student loan servicer at closing.
  • Only student loans for which the borrower is personally obligated can be paid through the  transaction.
  • Student loan debt must be paid in full with the proceeds – partial payments of student loan debt are not permitted.
New Policy
Eligibility
The standard cash-out refinance LTV, CLTV, and HCLTV ratios apply per the Eligibility Matrix.Max is 80%
Aligns with cash-out refinance
Underwriting Method
DU only
New policy
Maximum Cash Back
Lesser of 2% or $2k (over and above the student loan payoff)
Aligns with limited cash-out refinance
Mortgage Payoff
1st mortgage and purchase-money seconds
Aligns with limited cash-out refinance
Other Requirements
  • Property cannot be listed for sale at time of disbursement
  • Payoff of taxes ineligible unless escrow account is established
  • Payoff of delinquent taxes ineligible
Aligns with limited cash-out refinance

The expected impact of missing tax lien and civil judgment data