Category: bank statements

Qualifying for an FHA Loan in Kentucky

When it comes to buying a home in Kentucky, FHA loans are a popular choice for many first-time homebuyers due to their flexible qualifying criteria. If you’re considering an FHA loan in the Bluegrass State, understanding the key qualifying factors is crucial. Here’s a comprehensive guide to the criteria you need to know: Understanding these … Continue reading “Qualifying for an FHA Loan in Kentucky”

When it comes to buying a home in Kentucky, FHA loans are a popular choice for many first-time homebuyers due to their flexible qualifying criteria. If you’re considering an FHA loan in the Bluegrass State, understanding the key qualifying factors is crucial. Here’s a comprehensive guide to the criteria you need to know:

  1. Credit Score Requirements:
    • FHA loans are known for accommodating borrowers with lower credit scores. While the minimum required credit score can vary, typically, a credit score of 580 or higher is needed to qualify for the minimum down payment of 3.5%. However, borrowers with credit scores between 500 and 579 may still be eligible with a higher down payment, usually around 10%.
  2. Down Payment:
    • The minimum down payment for an FHA loan in Kentucky is 3.5% of the home’s purchase price. This is advantageous for buyers who may not have substantial savings for a larger down payment, making homeownership more accessible.
  3. Work History:
    • Lenders typically look for a steady 2 year employment history when considering FHA loan applications. A consistent work history, preferably with the same employer or within the same field, helps demonstrate financial stability and the ability to repay the loan.
  4. Debt-to-Income Ratio (DTI):
    • The debt-to-income ratio is a crucial factor in mortgage approval. For FHA loans, the maximum allowable DTI ratio is typically around 40% to 45% of your gross monthly income and can go higher up to 56% with good credit scores, large down payment or shorter term loan although lenders may consider higher ratios in certain cases if compensating factors are present.
  5. Bankruptcy and Foreclosure:
    • FHA loans have lenient guidelines regarding bankruptcy and foreclosure. Generally, borrowers with a past bankruptcy may qualify for an FHA loan after two years if they have re-established good credit and demonstrated responsible financial behavior. For foreclosures, the waiting period is usually three years.
  6. Mortgage Term:
    • FHA loans offer various mortgage term options, including 15-year and 30-year fixed-rate loans. The choice of term depends on your financial goals and ability to manage monthly payments.
    • Occupancy: Primary residences not for rental properties
    • Mortgage Insurance on the loan for life of loan. Larger down payments and shorter terms will reduce the upfront mi and monthly mi premiums
    • can be used for refinances, not only for purchases.
    • Max FHA loan in Kentucky is $498,257. This changes every year
    • No income limits nor property restrictions on where home is located
    • Can close within 30 days typically with good appraisal and title work

Understanding these qualifying criteria can help you navigate the FHA loan application process in Kentucky more effectively. Working with an experienced mortgage professional can also provide valuable guidance and assistance tailored to your specific financial situation and homeownership goals.

Joel Lobb  Mortgage Loan Officer

American Mortgage Solutions, Inc.
10602 Timberwood Circle
Louisville, KY 40223
Company NMLS ID #1364

Text/call: 502-905-3708
fax: 502-327-9119
email: kentuckyloan@gmail.com

http://www.mylouisvillekentuckymortgage.com/

 

 

 

 
NMLS 57916  | Company NMLS #1364/MB73346135166/MBR1574

 
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).
 

Bank Statement Basics for A Kentucky Mortgage Loan Approval for USDA, KHC, FHA, VA, Fannie Mae and Rural Housing Mortgage Loans

  • Assets:

    • Assets are not required; however, any assets disclosed must be supported with appropriate documentation
    • Satisfactory explanation and documentation should be provided for large deposits or increases in liquid assets
    • Cash on hand is not acceptable
    • Bank accounts require Verification of Deposit with average 2 month balance, or 2 consecutive months statements dated within 45 days of loan application
    • Earnest money deposit may be considered an asset if deposit is not already reflected in liquid assets
    • Asset amount of retirement accounts is 60% of the vested account balance
    • Gifts must be documented through gift donor letter and establish that gift does not have to be repaid
    • For sale proceeds of real property, provide HUD-1 or equivalent closing statement to indicate the actual amount of cash proceeds realized by the borrower
    • Stocks and bonds must be documented by a statement provide by stockbroker or financial institution managing the portfolio
    • Households with net family assets of greater than $5,000 require that the actual income derived from all net family assets or a percentage of the value of such assets based on the current passbook savings rate be considered when calculating income.
  • Government shutdown affects on USDA, FHA, VA, Rural Housing, KHC and Fannie Mae Mortgage loans in Kentucky (mylouisvillekentuckymortgage.com)
  • Kentucky Housing Corporation (KHC) homeownership programs affected by the current federal government shutdown (mylouisvillekentuckymortgage.com)
  • Louisville Ky Mortgage Lender FHA/VA KHC USDA Kentucky Mortgage: Kentuck… (mylouisvillekentuckymortgage.com)

Give us a try or let us compare your options on your next mortgage transaction. Call me locally at 502-905-3708. Free Mortgage Pre-Qualifications same day on most applications.

Email me at kentuckyloan@gmail.com with your questions

I specialize in Kentucky FHA, VA ,USDA, KHC, Conventional and Jumbo mortgage loans. I am based out of Louisville Kentucky.  For the first time buyer with little money down, we offer Kentucky Housing or KHC loans with down payment assistance.

This website is not an government agency, and does
not officially represent the HUD, VA, USDA or FHA or any other government agency.

NMLS# 57916 http://www.nmlsconsumeraccess.org/

Joel Lobb Senior  Loan Officer

American Mortgage Solutions, Inc.
10602 Timberwood Circle Suite 3
Louisville, KY 40223
phone: (502) 905-3708
 Fax:     (502) 327-9119
kentuckyloan@gmail.com
Company ID #1364 | MB73346E
EQUAL HOUSING LENDER