Tuesday, March 24, 2015

2015 Kentucky Rural Housing Guidelines for Flood Zones, Termite Reports, 2nd Mortgages, Unmarried couples, and Flipping Houses.

Can we get a Ky Rural Housing loan in a flood zone? 

Are termite inspections required for Ky Rural Housing Loans? 

This has not changed from the previous regulation. Termites for existing properties are only required if the lender, appraiser or inspector note infestation and require an additional inspection. 
For new construction, it is required if the town, city, county or state has a requirement.

Does KY Rural Development have any guidance regarding flipping? 

No. The appraiser would note the recent sale and should ensure that only recent comps are used.

Are 2nd mortgages allowed with KY USDA guaranteed loans?

Yes. The lender must have first lien position at closing. However, the lender may permit junior liens as long as:
- The lien will not interfere with repayment of the loan and has been considered in the underwriting process;
- The total value of all liens on the property is less than or equal to the property’s market value, except when a “soft-second” for down payment or closing costs
assistance creates the overage; and
- The junior lien is for an authorized loan purpose

Can two unmarried individuals apply for a KY USDA  Guaranteed loan together?

Yes. USDA Rural Development does not discriminate based on marital status. Unmarried applicants of any type may apply for a loan. All household income must be included in annual/eligibility income, regardless of whether they are a party to the note.