Kentucky USDA Rural Housing Mortgage Lender

  USDA Loans require that the borrower's income meet both "Income Eligibility" and "Income Qualifying" requirements.  Income Eligibility is income used to determine whether the income of all adult household members exceeds USDA's county specific and household size allowable limit. Income Qualifying is the income used to determine whether the income is appropriate to support the loan request. The components used to determine the income for both criteria differ. A common list of areas that should be reviewed by the Loan Officer with the borrower is as follows: Income Type Income - Eligibility Income - Qualifying Household Income Income of all adult members of the household are considered for qualifying purposes even if they are not on the loan application Use only income from borrower(s) on the loan application W-2 Annual Income Use Box 3 – Social Security Income Use Box 1 – Wages, tips, other comp Court Ordered Child Support and Alimony Use court ordered amou...

Theoretically, Kentucky USDA Loans are not credit score driven. Borrowers with no credit scores are even eligible for this loan program.  However, most investors that fund USDA Loans want to see a minimum middle credit score of 620. A 640 middle credit score is preferred, since this is the minimum credit score required for a USDA loan to receive an automated underwriting approval through the USDA Guaranteed Underwriting System or GUS.  Better yet, a borrower with a 680 middle credit score, can obtain a "credit waiver" on all minor derogatory credit items, such as late payments on the credit report and small collection accounts. Borrowers with major credit issues such as bankruptcies, short sales, or foreclosures within the last three years will not be eligible for a USDA Loan regardless of the credit score. If a borrower has a middle credit score less than 640, the loan request will be manually underwritten. As long as the borrower meets a more rigorous approval process, they...

Information on the Kentucky USDA Rural Development Loan, I am providing you with a series of informational  on the Kentucky Money Down USDA Rural Loan Program.  Yesterday I provided a quick overview of Kentucky USDA Loans minimum credit score requirements.  Today  I will like to discuss how a perspective home buyer can purchase housing using the USDA Loan program with no-to-minimal cash required at settlement. Since the USDA Rural Development Loan will finance 100% of the purchase price there is no down payment required on the loan. The only remaining items with out-of-pocket cash requirements by the buyer are the settlement related closing costs and escrows.  USDA allows these items to be paid for by the seller or financed into the new mortgage loan using flexible guidelines that can virtually eliminate the buyer's out-of-pocket cash requirements. Like every type of purchase transaction USDA Loans have closing costs.  However, the USDA Loan Progr...