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Kentucky Rural Housing Underwriting Changes for Debt ratio, Student Loans, Rental Income and Income
USDA has announced the publication of Chapter 11 revisions in the HB 3555 (advanced chapter previously announced in July), which are effective for conditional commitments dated on and after 09/22/2021. Important changes are as follows:
DTI Ratios – Payments for debt management plans must be added to the total debt ratio. If a payment plan exists for federal, state, or local taxes, it must be added to the DTI.
Revolving Debt, 30 Day Accounts – Revolving accounts with no outstanding balance are not required to be closed.
Student loans, Deferred Debt – For Non-Fixed payment loans, when the payment amount is zero, you must use either the current documented payment or .50% of the outstanding loan balance documented on the credit report.
Rental Income – Rental income can only be counted in the repayment income when it has been received for 24 months or more.
Debt Ratio Waiver - Refinance loans with GUS recommendations of Refer or Refer with Caution must have compensating factors to support the request for a debt ratio waiver and must be submitted to USDA.
