What are the Kentucky FHA Credit Score Requirements for 2019 Mortgage Loan Approvals?

 

unnamed (43)

Kentucky Mortgage Requirements for FHA, VA, USDA and Fannie Mae

 

 

Getting a FHA loan in Kentucky in 2019 you will be confronted with minimum credit score requirements set forth by FHA and the lender. Even though FHA will insure the mortgage loan at a certain credit score, you will see that lenders will create  “credit-overlays” to protect their risk and ask for a higher credit score.

So keep in mind when you are getting an FHA loan in 2019 some lenders will have higher credit score minimums in addition to the FHA Mortgage Insurance program.

For a Kentucky Homebuyer wanting to purchase a home or refinance their existing FHA loan, FHA requires a 3.5% down payment and the borrower must have a 580 FICO Credit Score. If the score is below 580, then you would need 10% down and still qualify on a manual underwrite.

You must have a FICO score of at least 500 to be eligible for a Kentucky  FHA loan. If your FICO score is from 500 to 579, your down payment on the loan is 10 percent of the loan.

If your FICO score is 580 or higher, your down payment is only 3.5 percent. If your credit score is less than 580, it may be more cost-effective to take the necessary steps to improve your score before taking out the loan, rather than putting the money into a larger down payment.

How do they get the credit score:  There are three main credit bureaus in the US. Equifax, Experian, and Transunion. The three scores vary but should be relatively close as long as the same creditors are reporting to the same bureaus.

You will get a variation in the scores due to all creditors or collection companies don’t report to all three bureaus. This is why they take the mid score.  So if you have a 590 Experian, 680 Equifax, and 620 TransUnion, your qualifying credit score would be 620

Based on my experience with lenders that I deal with in Kentucky on FHA loans,  most lenders require 620 middle credit score for consideration for loan approval.

How do they get the score:  They take the mid score, so if you have a 590 Experian, 680 Equifax, and 620 TransUnion, your qualifying score would be 620.

 

 

Kentucky FHA Loans with less than 620 Score

If your score is below 620, a manual underwrite is where the AUS (Automated Underwriting System) refers your loan to a human being, and they look at the entire file to see if they can overturn and approve the mortgage loan because the Desktop Underwriting Automated Software could not approve you.

With scores below 620, they typically will want to verify your rent history, have no bankruptcies in the last two years, and no foreclosures in the last 3 years.

If you have had any lates since the bankruptcy this will probably result in a denial on a refer manual underwrite file.

Your max house payment will be set at 31% of your gross monthly income,  and your new house payment plus the bills you are paying on the credit report cannot be more than 43%.

Typically, on scores below 620 for FHA loans, they will also look at reserves or money you have saved up after the loan is made to try and qualify you. For example, if you have a 401k or savings account that has at least 4 months reserves (take your mortgage payment x 4) and this would equal your reserves. They look at this as a rainy day fund and could help you keep up on your bills if you were unemployed or could not work.

Maximum FHA loan limits in Kentucky are set around $314,500 and below.

If you are looking to take a FHA loan in 2019 to buy or refinance a home in Kentucky, please contact me below with your questions about the credit score requirements and how they affect your loan approval.

What credit score do you need to qualify for a Kentucky mortgage loan?

The first thing to keep in mind is that qualifying for a mortgage involves a lot more than just a credit score. While your FICO score is a very important ingredient, it is just one factor. Lenders also look at your income and level of debt, among other things.

As a rule of thumb, however, a credit score below 620 will make buying a home very difficult. A FICO score below 620 is considered sub-prime. In the past, there were mortgage companies that specialized in sub-prime mortgages. Because of the challenges in the credit market over the last year or so, however, sub-prime loans have become difficult if not impossible to obtain.

A FICO score between 600 and 640  is considered fair to good credit. But keep in mind, this range of credit scores does not guarantee you will qualify for a mortgage, and if you do qualify, it won’t get you the lowest interest rate possible. Still, to buy a home aim for a score of at least 620, recognizing that other factors weigh in the decision and that some banks may require a higher score.

What credit score do you need to get a low rate mortgage?

It uses to be that a score of about 720 would yield the lowest mortgage rates available. Today, the best rates kick in with a FICO score of 760. And interest rates go up significantly as your credit score drops. To give you an idea, the following table shows current rates by credit score and calculates a monthly principal and interest payment based on a $300,000 loan:

lenders will pull what they call a “tri-merge” credit report which will show three different fico scores from Transunion, Equifax, and Experian. The lenders will throw out the high and low scores and take the “middle score.” For example, if you had a 614, 610, and 629 score from the three main credit bureaus, your qualifying score would be 614.
So if you only have one score, you may not qualify. Lenders will have to pull their own credit report and scores so if you had it ran somewhere else or saw it on a website or credit card you may own, it will not matter to the lender, because they have to use their own credit report and scores.
Lastly, lenders will pull your credit report for free nowadays so this should not be a big deal as long as your scores are high enough.
offered by FHA, VA, USDA, Fannie Mae, and KHC all have their minimum fico score requirements and lenders will create overlays in addition to what the Government agencies will accept, so even if on paper FHA says they will go down to 580 or 500 in some cases on fico scores, very few lenders will go below the 620 threshold.
If you have low fico scores it may make sense to check around with different lenders to see what their minimum fico scores are for loans.
The lenders I currently deal with have the following fico cutoffs for credit scores:
As you can see, different government-backed loan programs have different minimum score requirements with most lenders for an FHA, VA, or Fannie Mae loan, and 620  is required for the no down payment programs offered by USDA and KHC in Kentucky for First Time Home Buyers wanting to go no money down.

A Complete Guide to Closing Costs

Joel Lobb
Senior  Loan Officer
(NMLS#57916)
 Company ID #1364 | MB73346

unnamed (2) (1)

text or call my phone: (502) 905-3708
email me at kentuckyloan@gmail.com

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). USDA Mortgage loans only offered in Kentucky.

All loans and lines are subject to credit approval, verification, and collateral evaluation

J

 

 

Advertisements

What are the requirements to  qualify for a Kentucky FHA Mortgage?

What are the requirements to  qualify for a Kentucky FHA Mortgage in 2019?

Kentucky  FHA loan is a mortgage that is insured by the Government agency under Housing and Urban Development that is called FHA or short for Federal Housing Administration. The loan was established for Kentucky Home buyers will very little or no money down home loans with more  lenient credit score and  income requirements  and tends to be more forgiving about credit history with regard to bankruptcy and foreclosures, higher debt to income ratios and job history with limited work history for home buyers will only 2 years work history or less.

Kentucky FHA Credit Score Requirements and Down Payment Requirements

The Kentucky FHA  home loan  program may accept credit scores as low as 580 and require at least a 3.5 percent down payment of the sales price on a purchase. If you have a credit score below 580, then  a 10 percent down payment or more may be acceptable some FHA lenders in Kentucky , providing you meet all program guidelines in regards to debt to income ratios, assets, and income requirements .  The loan cannot be used for rental properties and does allow for co-signers if they are related.

Remember, these guidelines are set forth by FHA and all lenders do not have to offer these guidelines, to whereas they may a higher credit score or more money down or income restrictions on how much you can qualify for.

Kentucky FHA Mortgage Loans and Bankruptcy or Foreclosure

In case you had a  blemish on your credit report with a bankruptcy, short sale or foreclosure, follow these guidelines.

Kentucky FHA loans requires a passage of two years since the discharge date of a chapter 7 bankruptcy. A chapter 13 bankruptcy may be acceptable after at least 12 months of an on time pay-back period and the borrower has received permission from bankruptcy court to enter the mortgage transaction, and you qualify with the new house payment along with other debts on the credit report.

Three years must pass if you went through a short sale or foreclosure. The date starts when the home was sold, not when you entered the transaction toward foreclosure or short sale period. Sometimes the house will not sell to 1-2 years later after the foreclosure and this is when the passage date starts. Keep this in mind on your next FHA loan pre-approval if you have had a bankruptcy or foreclosure in the past.

Kentucky FHA Loans and Mortgage Insurance

FHA loans have two forms of mortgage insurance which protects the lender for any losses suffered if the borrower defaults on the payment. ne is called upfront mortgage insurance premium (UFMIP) which has a rate of 1.75% of the loan amount. The fee can be added to the loan amount or paid in full as part of your closing costs. In addition, FHA loans also have a 0.8-0.85% (of the loan amount) monthly mortgage insurance. In most cases, this mortgage insurance remains for the life of the loan. To eliminate the mortgage insurance, the borrower must refinance the loan into a non-FHA loan program and have 20% equity in the property.

In addition to the down payment requirements on a FHA loan, they’re closing costs and prepaids to pay at closing. The  seller can contribute up to 6% of the sales price to help the buyer with closing costs and prepaid expenses. Closing costs vary from lender to lender and your prepaids would be the same no matter which lender you choose because this is a function of the property ‘s home insurance premium quote you obtain and the property tax bill on the home set by PVA.

Sometimes the lender can pay a credit toward these expenses at closing with a lender credit which lets the lender credit back to you with a higher rate to reduce the costs of the loan’s costs at closing for out of pocket expenses.

All Kentucky FHA loans are assumable, which means that when the homeowner sells a home, the buyer may be able to take on the existing loan and terms (e.g.: balance, rate and remaining loan amount). Of course, anyone interested in the assumable loan feature must go through the approval process (credit check, income verification) with the current lender on the property. This is a very rare occurrence because most sellers are going to sell the home for more than they owe on it.

Kentucky FHA Loan Requirements

 

For a detailed explanation of the requirements, you can read the HUD handbook and check with prospective lenders.

A Complete Guide to Closing Costs

Joel Lobb
Senior  Loan Officer
(NMLS#57916)
 Company ID #1364 | MB73346

 unnamed (2) (1)

text or call my phone: (502) 905-3708
email me at kentuckyloan@gmail.com

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). USDA Mortgage loans only offered in Kentucky.

All loans and lines are subject to credit approval, verification, and collateral evaluation

How to qualify for a Kentucky FHA Home Loan ?

How to qualify for a Kentucky FHA Home Loan ?

Image result for fha loans ky

 

 

FHA stands for the Federal Housing Administration which is a government agency created to increase home-ownership across the United States all the way back in 1934. The agency itself doesn’t offer home loans but insures loan that are offered by private lenders (i.e. mortgage companies).

It’s important to understand the different types of loan programs available to you and what benefits and drawbacks there are to each type.

For example, if you’re looking to find a fixer upper this may not be the right loan program for you. But an FHA loan may be a better fit for you if you have little cash saved up for a down payment or if you don’t have a high credit score.

Kentucky FHA loan requirements:

  • At least 18 years old to apply
  • No age limit. just must be 18 years of age to apply.
  • Must occupy the home as a primary residence, no rental homes or investment property
  • An appraisal must be done by an FHA-approved appraiser.Typically FHA appraisal in Kentucky costs anywhere from low-end $325 to $525 with most FHA lenders in KY.
  • Home inspection is not required
  • Termite inspection not required
  • 2 years removed from Chapter 7 bankruptcy, and 1 year in Chapter 13 bankruptcy is possible to get a loan while in bankruptcy
  • Foreclosure or short sale on previous home mortgage requires 3 years removal from those dates.
  • Mortgage insurance (MIP) is required
  • Upfront Mortgage Insurance Premium is 1.75% and monthly mortgage insurance is .85% or .80% depending on loan term and loan to value.
  • Mortgage insurance is for life of loan.
  • No matter your credit scores, everyone pays the same mortgage insurance premiums.
  • Must have 2 years of employment history proving a reliable source of income
  • 500 FICO score requirement with at least 10% down payment
  • 580 FICO score requirement with at least 3.5% down payment
  • Gifts and down payment assistance programs are allowed to meet your down payment requirements. Cannot come from seller, but seller can contribute up to 6% of the sales price toward buyer’s closing costs and prepaids.
  • Student loan payments are factored into the debt-to-income ratio when applying. Typically if loans are deferred, or in an income=based repayment plan, the FHA underwriters will use 1% of the outstanding balance, which sometimes can make it difficult to qualify.
  • Your debt-to-income ratio must not be higher than 31% or total debt obligation cannot be higher than 43% of your current income. This is for a manual underwriter, meaning that if the AUS underwriting system by mortgage lenders will approve you for a higher debt to income ratio, that is fine.

 

New FHA loan limits for 2019 in Kentucky:

The Kentucky FHA has a maximum loan limit it will insure. These Kentucky FHA loan limits are updated each year and are influenced by the conventional loan limits set by Fannie Mae and Freddie Mac. Other things like the type of home (i.e. duplex or single-family) can also affect the FHA loan limits. *

For low-cost areas, the loan limit increased from $294,515 to $314,827 for all Kentucky Counties in 2019. . You can check the FHA loan limits in your area here.

 

American Mortgage Solutions, Inc.
10602 Timberwood Circle Suite 3
Louisville, KY 40223
Company ID #1364 | MB73346


Text/call 502-905-3708
kentuckyloan@gmail.com

http://www.nmlsconsumeraccess.org/
If you are an individual with disabilities who needs accommodation, or you are having difficulty using our website to apply for a loan, please contact us at 502-905-3708.

Disclaimer: No statement on this site is a commitment to make a loan. Loans are subject to borrower qualifications, including income, property evaluation, sufficient equity in the home to meet Loan-to-Value requirements, and final credit approval. Approvals are subject to underwriting guidelines, interest rates, and program guidelines and are subject to change without notice based on applicant’s eligibility and market conditions. Refinancing an existing loan may result in total finance charges being higher over the life of a loan. Reduction in payments may reflect a longer loan term. Terms of any loan may be subject to payment of points and fees by the applicant  Equal Opportunity Lender. NMLS#57916http://www.nmlsconsumeraccess.org/

— Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. This is not a commitment to lend. Programs, rates, terms and conditions are subject to change without notice. The content in this marketing advertisement has not been approved, reviewed, sponsored or endorsed by any department or government agency. Rates are subject to change and are subject to borrower(s) qualification.

FHA vs Conventional Infograhic

Student Loans In Collections, What Can I Do to get Approved For A Kentucky Mortgage ?

Student Loans In Collections, What Can I Do?
If you have public student loans in collections, you really have three options to resolve it so it is not a CAIVRS issue.
1.      Pay it off in full – Not typically an option because very rarely do the clients have the funds to do so.
2.      Consolidation – Only takes about 90 days to consolidate and resolve CAIVRS issues. However, you push forward the last activity dates, DLA, and also introduce a new credit trade line that dilutes the length of the credit history. So you will normally see a drop in credit score.
3.      Rehabilitation – It is the slowest of all the options, but is the best thing for the clients’ credit scores. It is a 9 month commitment and once the client makes 9 consecutive payments, they will change the collection status to a good standing status. This will typically net a 40-100 point boost in the score depending on how many other collections are on the credit report.
If your client does not know who is servicing the student loan, they can contact the Student Loan Default Resolution Team at 1-800-621-3115 or visit the website at myeddebt.ed.gov
Bonus Tip: Private student loans do not adhere to consolidation or rehabilitation rules. If the client has private student loans in collections they will need to pay them off in full, or they will need to set up a payment plan on them. They will still remain in collections with a payment, but if you can get a qualified credit score you can push forward the loan including the liability payment towards the debt to income ratio.
As always, we bring you the best content so you can do what you do best, CLOSE LOANS! If you aren’t already sending us every credit challenged borrower you have, what is stopping you?
Guidelines for KY FHA, VA, USDA and VA Mortgage loans with Student Loans on A Credit Report:
Kentucky Fannie Mae or Conventional Guidelines for Student Loans:
  • If a monthly payment is on the credit report, the lender may use that amount for qualifying purposes.
  • If a monthly payment is on the credit report is incorrect, the lender may use the monthly payment on the most recent student loan statement
  • If the monthly payment on the credit report is zero, the lender must use one of the following options to calculate the payment for qualifying purposes
  1. Document the borrower is on an income driven payment plan and the actual monthly payment is zero
  2.  Use 1% of the outstanding student loan balance as the monthly payment
  3. Calculate a fully amortized payment using documented loan repayment terms
Kentucky FHA Mortgage Loans Guidelines:
Regardless of the payment status (currently in payment or deferred), the lender must use either:
  • The greater of:
  1. 1% of the outstanding balance; or
  2. The monthly payment reported on the credit; or
  •  Calculate a fully amortized payment using documented loan repayment terms
Kentucky USDA or Rural Housing Guidelines:
 
 
Regardless of the payment amount reporting on the credit, the lender must include the payment as follows:
  • 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 repayment term is fixed.
  • Payments for deferred loans, Income Based Repayment (IBR), Graduated, Adjustable, and other types of repayment agreements which are not fixed cannot be used in the total debt ratio calculation. One percent of the loan balance reflected on the credit report must be used as the monthly payment. No additional documentation is required.
Kentucky  VA Mortgage Guidelines for Student Loan:
  • If the borrower can document the student loan will be deferred 12 months from the closing date, the monthly payment does not need to be considered
  • If a student loan is in repayment or scheduled to begin repayment within 12 months from the closing date, the threshold payment amount must be calculated by  using 5% of the loan balance divided by 12 months
  • If the payment reporting on the credit report is greater than the threshold payment calculation amount, then the credit report payment must be used for ratios.
  • If the payment reporting on the credit report is less than the threshold payment calculation and the lender is using the lower payment to qualify the borrower then:
  1. A statement from the student loan servicer reflecting the actual loan terms and payment information must be included in the file.
  2. The statement must be dated within 60 days of closing
  3. It is the underwriter’s discretion to use the lower payment

As you can see, Fannie Mae or Conventional loans is the most lenient when it comes to qualifying for a mortgage loan with someone that has a lot of student loans on their credit report.

Here are action steps you can take right now to buy a home in Kentucky in 2019


1. Focus on your credit score

FICO credit scores are among the most frequently used credit scores, and range from 350-800 (the higher, the better). A consumer with a credit score of 750 or higher is considered to have excellent credit, while a consumer with a credit score below 620 is considered to have poor credit.

To qualify for a mortgage and get a low mortgage rate, your credit score matters.

Each credit bureau collects information on your credit history and develops a credit score that lenders use to assess your riskiness as a borrower. If you find an error, you should report it to the credit bureau immediately so that it can be corrected.


2. Manage your debt-to-income ratio

Many lenders evaluate your debt-to-income ratio when making credit decisions, which could impact the interest rate you receive.

A debt-to-income ratio is your monthly debt payments as a percentage of your monthly income. Lenders focus on this ratio to determine whether you have enough excess cash to cover your living expenses plus your debt obligations.

Since a debt-to-income ratio has two components (debt and income), the best way to lower your debt-to-income ratio is to:

First Ratio – The first ratio, top ratio or housing ratio. Basically that means out of all the gross monthly income you make, that no more that X percent of it can go to your housing payment. The housing payment consists of Principle, Interest, Taxes and Insurance. Whether you escrow or not every one of these items are factored into your ratio. There are a lot of exceptions to how high you can go, but let’s just say that if your ratio is 33% or less, generally, across the board, you’re safe.

Second Ratio- The second ratio, bottom ratio or debt ratio includes the housing payment, but also adds all of the monthly debts that the borrower has. So, it includes housing payment as well as every other debt that a borrower may have. This would include, Auto loans, credit cards, student loans, personal loans, child support, alimony….basically any consistent outgoing debt that you’re paying on. Again, if you’re paying less than 45% of your gross monthly income to all of the debts, plus your proposed housing payment, then……generally, you’re safe. You can go a lot higher in this area, but there are a lot of caveats when increasing your back ratio.

3. Keep credit utilization low on your credit cards

Lenders also evaluate your credit card utilization, or your monthly credit card spending as a percentage of your credit limit.

Ideally, your credit utilization should be less than 30%. If you can keep it less than 10%, even better.

For example, if you have a $10,000 credit limit on your credit card and spent $3,000 this month, your credit utilization is 30%.

Here are some ways to manage your credit card utilization:
set up automatic balance alerts to monitor credit utilization
ask your lender to raise your credit limit (this may involve a hard credit pull so check with your lender first)
pay off your balance multiple times a month to reduce your credit utilization


4 . Look for down payment assistance in Kentucky

There are various types of down payment assistance, even if you have student loans.

Here are a few:
FHA loans – federal loan through the Federal Housing Authority
USDA loans – zero down mortgages for rural and suburban homeowners
VA loans – if military service
Kentucky Housing Down Payment Assistance of $6000

There are federal, state and local assistance programs as well so be on the look out.
If you want a personalized answer for your unique situation call, text, or email me or visit my website below:

Joel Lobb
Mortgage Loan Officer
Individual NMLS ID #57916

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

click here for directions to our office

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

https://www.mylouisvillekentuckymortgage.com/

Disclaimer: No statement on this site is a commitment to make a loan. Loans are subject to borrower qualifications, including income, property evaluation, sufficient equity in the home to meet Loan-to-Value requirements, and final credit approval. Approvals are subject to underwriting guidelines, interest rates, and program guidelines and are subject to change without notice based on applicant’s eligibility and market conditions. Refinancing an existing loan may result in total finance charges being higher over the life of a loan. Reduction in payments may reflect a longer loan term. Terms of any loan may be subject to payment of points and fees by the applicant Equal Opportunity Lender. NMLS#57916 http://www.nmlsconsumeraccess.org/

Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. This is not a commitment to lend. Programs, rates, terms and conditions are subject to change without notice. The content in this marketing advertisement has not been approved, reviewed, sponsored or endorsed by any department or government agency. Rates are subject to change and are subject to borrower(s) qualification.

Latest FHA shift to mitigate risks may shut out some Kentucky home buyers wanting FHA Loans in 2019

Kentucky FHA Loan Changes for Fico and Credit Scores for 2019

 

Latest FHA shift to mitigate risks may shut out some homebuyers:

Kentucky FHA Loan Changes for FICO Scores and Credit Scores for 2019

Kentucky FHA Loan Changes for Fico and Credit Scores for 2019

Last week, the Federal Housing Administration took steps to mitigate risks to its single-family portfolio, announcing updates to its TOTAL Mortgage Scorecard that may flag some loans for manual underwriting.
The change applies to all loans with case numbers assigned on or after March 18th, meaning that it is likely to affect some of the loans currently sitting in an FHA lender’s pipeline.
Chatter among members of the lending community suggests a number of originators are unhappy about the changes, fearing that the end result may be that some of their borrowers will be shut out of FHA financing.
Some said the FHA did not go about implementing the changes the right way, creating confusion about how the risk is being mitigated, while others said they felt as if the rug had been pulled out from under them, and fear that borrowers who no longer qualify will be angry, according to email exchanges between lenders and mortgage brokers, shared with HousingWire.
For its part, the FHA said it is taking necessary steps to address some of the risk trends apparent in its single-family portfolio and flagged as concerning in its 2018 Report to Congress.
Specifically, FHA loans have seen a substantial increase in cash-out refinances, a drop in the average borrower credit score, and an increase in borrowers with high debt-to-income ratios.
In its letter about the Scorecard updates, the FHA said that the number of FHA refinances that are cash-outs increased 60% in 2018, and that almost a quarter of all FHA loans in 2018 had a DTI ratio above 50%.
The average credit scores for FHA borrowers has also declined, falling to 670 in 2018 – the lowest average since 2008.
Combined, these factors are signaling untenable risk for the agency as they flag the potential for the program to drain the Mutual Mortgage Insurance Fund.
“Federal Housing Commissioner Montgomery has publicly stated numerous times in recent months that FHA must seek the right balance between managing risk and fulfilling its mission of supporting sustainable home-ownership,” the FHA said in its letter.
“To be successful long term, FHA must maintain the integrity of its insurance endorsements,” it continued. “This includes assessing the causes of the increase in higher-risk credit characteristics in the portfolio and making prudent and necessary changes to re calibrate and adjust its policies as warranted to manage credit risk.”
The agency said the updates to its Scorecard are just the first step it will be taking to address these risk factors.
“FHA will carefully monitor the impact of this change and is preparing to implement additional changes to maintain a better balance of managing risk and fulfilling its mission,” the agency stated.

 

I can answer your questions and usually get you pre-approved the same day. 


Call or Text me at 502-905-3708 with your mortgage questions.
Email Kentuckyloan@gmail.com

Joel Lobb
Mortgage Loan Officer
Individual NMLS ID #57916
 
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
 

 

 

 

 

 

Source: Latest FHA shift to mitigate risks may shut out some homebuyers

Can you get a mortgage loan while in a Chapter 13 Bankruptcy:

Here is a brief summary on getting a mortgage loan while in a Chapter 13 Bankruptcy:
 
You must have 12 payments paid into the Chapter 13 before you can apply for a mortgage loan.
 
The payments must be made on time for last 12 months or after 12 months if you have been in longer, so no late payments to the Chapter 13 while in it. 
 
You have to ask permission from the courts to seek a mortgage loan. They usually grants this. I have never not seen them grant it.
 
You have to qualify with the new house payment along with Chapter 13 payments and other debts listed on credit report. Debt to income ratios usually center around 31 and 43% respectively, meaning the new house payment should not be more than 31% of your gross monthly income and your total house payment and debts listed on credit report along with Chapter 13 payment should not be more than 43% of your total gross monthly income. 
 
Credit scores: Most FHA lenders I work with will want a 620 middle score. You have three fico scores from Experian, Equifax, and Transunion, and they throw out the high and low score and take middle score. For example, if you had a 598, 679, and 590 scores respectively for all three bureaus listed above, your qualifying score would be 598.
There are some FHA investors that I am set up with that will go down to 580, but I have seen in my past experiences 620 will get you a better deal and far greater chance of closing on your loan with FHA. 
 
Down payment: For FHA loans, you will need to have at least 3.5% down payment saved up. It is extremely hard to find a no money down loan program to get you approved for a mortgage while you are in a Chapter 13 plan. 
 
FHA and USDA are really the only two options that I know of that offer financing for a borrower with a current Chapter 13 Bankruptcy plan plan, so keep that in mind. 
 
Conventional loan program offered by Fannie Mae will not allow a mortgage loan for someone in a Chapter 13 Bankruptcy plan.
 
On USDA loans, it is possible to get 100% Financing after you have paid into the plan for 12 months with a good pay history. The credit scores needed for a USDA loan approval really need to be above 640 in my past experience in getting them approved. A lot of USDA lenders will say they will do down to 620, but it is very difficult getting them approved. Best to get your scores up to increase your changes in qualifying for a USDA loan. There is not much that difference in getting your scores up to that range if you are at a 620 score now. 
 
With USDA loans, they have income and property eligibility requirements that FHA does not have, so below is a rough run down of FHA vs USDA loan for you:
 

Typically, USDA-eligible properties are located in rural areas. It is a mistake, however, to think that you have to live far out in the country to qualify for a USDA loan. USDA-eligible properties are often located near urban areas.

A property’s eligibility is determined by its location with respect to USDA’s map of eligible locations. The USDA program also places limits on your household income based on median earnings in an area. If you exceed that limit, you can’t obtain a USDA loan.

The FHA, by contrast, does not place limits on household earnings. The FHA, however, does establish a maximum limit on the amount of money that can be borrowed through the program.

 

So if you were in a hurry to buy, after you have been in your Chapter 13 plan for 12 months, I can look at getting you approved to buy a home if you wish:
 
In order to get you pre-approved for your max loan amount, I will need the following items from you. This is a free process and I will give you a copy of your credit report for free!
 
 
Mortgage Pre-Approval Checklist
 
1.  Last 30 days worth of pay stubs
2.  Last 2 years W-2′s
3.  Last 2 years tax returns
4.  Last two months bank statements for all accounts including 401 k or retirement account  if you have one
 
____________________________________________
 
 
Once I get the information above, I can usually get you pre-approved in one day, and get your loan closed in 30-45 days after you get an accepted offer on a home. 
 
Your first house payment usually starts 30-60 days after you close.
 
Your loan pre-approval is usually good for 90 days.
 
I don’t need originals, copies are fine. You can fax or email  me the above documents,  or meet me face-to-face if you wish to make copies and go over your options.
 
Let me know your questions. 
 
Thanks and look forward to helping you. 
 
Joel Lobb
Mortgage Loan Officer
Individual NMLS ID #57916
 
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
 
 

unnamed (1)KENTUCKY VA REFINANCE LOAN

If you have questions about qualifying as first time home buyer in Kentucky, please call, text, email or fill out free prequalification below for your next mortgage loan pre-approval.

Joel Lobb
Senior  Loan Officer

(NMLS#57916)


Text or call phone: (502) 905-3708

email me at kentuckyloan@gmail.com

http://www.mylouisvillekentuckymortgage.com/


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 views of my employer. Not all products or services mentioned on this site may fit all people

This web site is not the FHA, VA, USDA, HUD or any other government organization responsible for managing, insuring, regulating or issuing residential mortgage loans.

**Download Fair Housing Booklet – CLICK HERE

All approvals and rates are not guaranteed, and are only issued based on standard mortgage qualifying guidelines



Remember, we are even available this weekend for pre-qualifications or questions.  Call our cell phone or email us.  If you miss us, leave a message and we WILL call you back 

How long do you have to wait to get approved for a mortgage loan after a bankruptcy in Kentucky?

GETTING A MORTGAGE LOAN IN KENTUCKY WHEN YOU HAVE HAD A BANKRUPTCY
ARE YOU CURRENTLY IN A CHAPTER 13 BANKRUPTCY OR HAD A CHAPTER 7 BANKRUPTCY IN THE PAST?

Qualifying For A Kentucky Mortgage After Bankruptcy

Home Buyers can qualify for a Kentucky mortgage after bankruptcy:

  • 2 year waiting period to qualify for FHA Loan to qualify for a FHA Loans after discharge of Chapter 7.
  • One year into a Chapter 7 Bankruptcy to qualify for a Chapter Loan into a Chapter 13 Bankruptcy repayment plan.
  • No waiting period after a Chapter 13 Bankruptcy discharge date.
  • 4 year waiting period to qualify for a Chapter 7 Bankruptcy discharge date to qualify for a Conventional Loan.
  • Two year waiting period to qualify for a Chapter 13 after Chatper 13 discharged date to qualify for a Conventional Loan.
  • Four year waiting period to qualify for a Conventional Loan if you had a mortgage part of bankruptcy but the foreclosure needs to be be finalized

unnamed (1)

Joel Lobb (NMLS#57916)
Senior  Loan Officer
 
American Mortgage Solutions, Inc.
10602 Timberwood Circle Suite 3
Louisville, KY 40223
Company ID #1364 | MB73346
 


Text/call 502-905-3708
kentuckyloan@gmail.com

http://www.nmlsconsumeraccess.org/
Disclaimer: No statement on this site is a commitment to make a loan. Loans are subject to borrower qualifications, including income, property evaluation, sufficient equity in the home to meet Loan-to-Value requirements, and final credit approval. Approvals are subject to underwriting guidelines, interest rates, and program guidelines and are subject to change without notice based on applicant’s eligibility and market conditions. Refinancing an existing loan may result in total finance charges being higher over the life of a loan. Reduction in payments may reflect a longer loan term. Terms of any loan may be subject to payment of points and fees by the applicant  Equal Opportunity Lender. NMLS#57916 http://www.nmlsconsumeraccess.org/
 

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. Mortgage loans only offered in Kentucky.