Kentucky USDA Rural Housing Mortgage Lender

 Chapter 11- Ratio Analysis 11.2 B. The Total Debt Ratio:  Revolving accounts: “with no outstanding balance” are not required to be closed.  Mortgages: Rental Property - Eliminated language regarding omission of mortgage debt. Guidance for entry of rental income in GUS is provided in the GUS Lender User Guide under 4.1.4.1.1, Retained Investment Properties.  Added: Debt management plans: o Include the monthly payment amount due from the counseling plan. o Refer to Chapter 10 for guidance on credit exception and documentation requirements.  Student Loans: Removed the phrase “the greater of” from Non-Fixed payment loans and added guidance regarding “when the payment is above zero” and “when the payment is zero”. 2 11.3 DEBT RATIO WAIVERS AND COMPENSATING FACTORS A. Purchase Transactions: Debt ratio waivers  GUS Refer, Refer with Caution, and manually underwritten loans without GUS assistance: o Added: “The lender must document compensating factors to support a debt ratio waiver....

Louisville Kentucky Mortgage Lender for FHA, VA, KHC, USDA and Rural Housing Kentucky Mortgage: FHA now allowing 0.5% on Student Loans instead of 1% :   FHA now allowing 0.5% on Student Loans instead of 1% On Friday, the  Federal Housing Administration (FHA ) announced updates to its studen... FHA now allowing 0.5% on Student Loans instead of 1% On Friday, the  Federal Housing Administration (FHA ) announced updates to its student loan monthly payment calculations to take steps to remove barriers and provide more access to affordable single-family FHA-insured mortgage financing for creditworthy individuals with student loan debt. The updated policy more closely aligns  FHA student loan debt  calculation policies with other housing agencies, helping to streamline and simplify originations for borrowers with student loan debt obligations. This announcement enhances FHA’s ability to serve one of its core demographics—first-time homebuyers. For all outst...

A Change in Underwriting for USDA Mortgage Loans in Regards to Student Loans.  Effective immediately for all Kentucky USDA Rural Housing Mortgage Loans. If you are a Kentucky USDA Mortgage applicant who has student loan calculations will be changed to the following Fixed Payment Loans: A permanent amortized, fixed payment may be used when it can be documented that the payment is fixed, the interest rate is fixed, and the repayment term is fixed.  Non-Fixed Payment Loans (i.e. deferred, income based, graduated, adjustable, etc.): The payment should be calculated as the greater of 0.5% of the loan balance or the actual payment reflected on the credit report. No additional documentation is required. Student loans. Lenders must include the payment as follows: Fixed payment loans : A permanent amortized, fixed payment may be used in the debt ratio when the lender retains documentation to verify the payment is fixed, the interest rate is fixed, and the repayme...

Kentucky Rural Housing USDA Loan Financing - Student Loan Monthly Payment Calculations Debt-to-income ratio for borrowers with student loans and getting approved for a USDA Loan in Kentucky.  For potential Rural Kentucky  home buyers with student loans that are either in a deferred payment status or being paid back through an income based repayment program, the treatment of this liability needs to be considered. When student loan debts are not currently being paid upon, due to the loan applicant still being in school or recently graduating from school, the monthly liability will be calculated as 1% of the outstanding loan balance.   Example if you owe $100,000 in student loan debt the monthly payment will be $1,000.  Also, if the student loan is being paid upon, but at a lesser amount than originally agreed, such as the payment being determined based on repayment ability (i.e. Income Based Repayment Plan), the monthly payment will be calculated the same...

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 specif...

Kentucky Rural Housing and USDA Student Loans  Guidelines Changes for 2016 Recent updates to the 3555 Handbook intended to simplify guidance for the delivery of the guaranteed loan program have caused some misperception in regards to total debt ratio calculations, specifically in the subject of student loans.  The Agency is working on revisions to Chapter 11: Ratio Analysis; however, we want to further clarify the subject at this time. Total debt includes monthly housing expenses plus any other credit obligations incurred by the applicant.  Student loan payments must be included in the calculation of the total debt-to-income ratio and captured under liabilities on the application.  Student loan payments should be treated as described below: Fixed payment loans :  A fixed payment may be used in the debt ratio when the lender retains documentation to verify the payment is fixed, the interest rate is fixed, and the r...