Louisville Kentucky First Time Home Buyer Programs and Resources


Louisville Kentucky First Time Home Buyer Programs and Resources.

via Louisville Kentucky First Time Home Buyer Programs and Resources.

 
Joel Lobb
Senior  Loan Officer

(NMLS#57916)
 
American Mortgage Solutions, Inc.
800 Stone Creek Pkwy, Ste 7,
Louisville, KY 40223
 Fax:     (502) 327-9119
 
 Company ID #1364 | MB73346

 

Joel Lobb - Mortgage Broker or Lender at Kentucky FHA, VA, USDA, KHC and  First Time H

The Biggest Mistake Consumers Make When Taking Out a Home Loan


The Biggest Mistake Consumers Make When Taking Out a Home

 

Loan.

 

Bank Statements Don’t Reveal the Whole Picture

Bank statements show the funds in your account, but whether these funds are legitimate is another question indeed. And cash deposits that are inconsistent with your banking history will be under the lender’s magnifying glass. In fact, cash deposits cause more problems and scrutiny for consumers trying to secure mortgages credit today than any other credit item.  So let’s take a look at the typical scenarios homebuyers need to be ready for when documenting their cash in the bank.

If any deposit is more than 25% of your monthly income…

Then monies will have to be sourced with a clear letter of explanation, or a potential gift letter if the money came in the form of a gift, along with a statement from the person gifting that money showing they had the ability to do so.

If any deposits are less than 25% of your monthly income…

Then these funds can be used in the loan transaction, although the consumer may be asked to explain where the funds originated. However, no paper trailing will be required.

If cash is from a side job or any other exterior source other than your occupation…

Then — if it is needed for the mortgage transaction — that money will have to be “seasoned” for a period of 60 days, meaning those funds are ineligible for use toward the mortgage until two statement cycles have passed.  Then those funds will be eligible.

If a deposit is a gift…

Then the person giving the gift needs to show on paper a clear ability for them to gift money to the recipient. In other words, a friend of the person giving the gift can’t make a deposit in the giftor’s account without getting a clear and concise explanation including a gift letter and subsequent paper trail with bank statements showing where the funds originated and where the funds ended up.

If additional reserves are needed, e.g. two months’ worth of mortgage payments liquid in the bank (which is typically what’s needed)…

Then consumer must meet the 60-day seasoning requirement, unless the funds are from paychecks in the normal course of pay periods.

Credit Fico Score for a Kentucky Mortgage FHA VA KHC


Fannie Mae

According to the “Washington Post,” Fannie Mae raised its minimum credit score for conventional loans in 2009 from 580 to 620. Even if you have a 20-percent down payment, you can be rejected if your score is below 620. Fannie Mae will also reject a loan if more than 45 percent of your income goes toward paying debt.




Government-Backed Loans

FHA recently changed its minimum credit score to 580, which qualifies you for lending programs that require only a 3.5 percent down payment.

VA loans are 100-percent financed and set aside for active and retired military, along with their families. There is no minimum credit score to qualify, though a better credit score will get you a better interest rate. Typically to get approved on A VA loan, you will need a 620 mid score with no bankruptcies or foreclosures in last 2 years with clean credit since BK or Foreclosures.

The better your score, the better your interest rate is likely to be. If your score is between 620 and 639—considered a risky score by some creditors—you could pay an interest rate of 5.718 percent on a $300,000, 30-year conventional mortgage. As of mid-August, 2010, If your score is at the high end, 760 to 850, your interest rate could be 4.129 percent on the same loan. A score of 650 may net you a rate of 5.172 percent.



USDA Home Loan Debt Ratio Waivers will be considered when the borrower has amiddle credit score of 660 or higher, and the co-borrower has a credit score of at least 620.  

If borrowers have credit scores of 659 or below, additional compensating factors will need to be documented for the USDA Home Loan Underwriters.

Joel Lobb
Senior  Loan Officer

(NMLS#57916)
 
 Fax:     (502) 327-9119
 
 Company ID #1364 | MB73346

 

Tuesday, June 21, 2011

Fico Score for Kentucky Mortgage

Credit Score needed in 2014 for a Kentucky Mortgage Loan Approval for a USDA, RHS, RD, FHA, VA, Fannie Mae and KHC Loan in Ky
Credit Score needed in 2014 for a Kentucky Mortgage Loan Approval for a USDA, RHS, RD, FHA, VA, Fannie Mae and KHC Loan in Ky
A FICO score rating is a credit rating “number” given to consumers. FICO stands for Fair, Isaac and Company and the FICO score rating was developed in 1989. This is a score that is used by lenders sometimes separate from or in addition to a score provided by the three major Credit Reporting AgenciesExperian, TransUnion and Equifax(although Equifax is affiliated with FICO so they will provide you with a FICO score when requesting a credit report).If you don’t know what your FICO score is, you should find out. The reason why this is important is because lenders will determine the type of loan they will offer you based on your credit history, employment history, other factors, credit reports and the FICO score. The numbers range between 350 and 800. The “average” score is about 725 to 750.How is a FICO Score / Rating Determined?Here’s general guideline of what the FICO score / rating numbers mean:

750 to 850 – Excellent

660 to 749 – Good

620 to 659 – Fair

350 to 619 – Poor

How is the FICO score rating determined? As a general rule, following factors help determine your FICO score:

35%, punctuality of payment in the past (only includes payments later than 30 days past due)

30%, the amount of debt, expressed as the ratio of current revolving debt (credit card balances, etc.) to total available revolving credit (credit limits)

15%, length of credit history

10%, types of credit used

10%, recent search for credit and/or amount of credit obtained recently

How to Improve Your FICO Score / Rating?

The following tips are recommended by FICO and credit reporting agencies to improve your FICO score and credit rating:

The most obvious tip: Pay your bills on time. Delinquent payments and collections can have a significantly negative impact on your FICO score.

If you have missed payments, get current and stay current.

Pay off debt rather than move it around.

Re-establish your credit history if you have had problems. Opening new accounts responsibly and paying them off on time may help in the long term. Opening a “secured” credit card (when your credit card limit is matched with a savings account with the lender/bank for the same amount) can help rebuild your credit.

Keep credit cards but manage them responsibly. In general, having credit cards and installment loans (and makingg timely payments) may help in the long term. Consumers with no credit cards, as an example, can be thought of by lenders as a higher risk than someone who has managed credit cards responsibly.

If you are having trouble paying your creditors, contact them to work out a payment schedule or contact a reputable credit counselor.

Keep credit card and revolving credit balances low.

Apply for and open new credit cards, loans, revolving accounts only as needed.

FICO Score / Rating Resources

The best resource in finding out your current score is the myfico website. For a fee, you can order a report that is compiled from the 3 major credit reporting agencies and will outline your FICO score.

Suze Orman also offers a FICO kit on her website, suzeorman.com, which is also available via the myfico website. Suze’s website also has excellent info about improving your FICO score and your credit.

Clink on this link for Free Credit Report and Application

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.

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.