Kentucky First Time Home Buyer Loan Programs for FHA, VA, KHC and USDA Mortgage Loans in Kentucky
A Kentucky Mortgage Loan Officer that has closed over 600 home loans specializing in Kentucky First Time Homebuyer Loans to include the following FHA, VA, USDA, Rural Housing, Down Payment Assistance Loan from Kentucky Housing Corp or KHC and the Fannie Mae Home Path HUD $100 Down Mortgage Program in Kentucky. Call/Text 502-905-3708 with your mortgage questions or email kentuckyloan@gmail.com I try to respond to all requests within minutes during regular business hours. NMLS# 57916 Equal Housing Lender
Text/call:Â Â Â 502-905-3708
When it comes to financing a home a buyer is faced with the decision of what type of loan they want. The two most common choices are FHA or Conventional. Both have their advantages and disadvantages. Follow the chart below to see which one is a fit for you!
For more information on homes available for FHA or Conventional
Which Loan is better for you?
⢠Credit scores less than 680.
⢠Less than 5% down payment and no reserves to use.
⢠Borrowers with past foreclosures between 3 and 7 years old.
⢠Borrowers with past short sales between 2 and 4 years old.
⢠Borrowers who need a gift for the down payment and/or closing costs, prepaid taxes and
insurance.
The FHA Mortgage Insurance premium is a premium that exists for the FHA Loan that is
paid up front and monthly by the homebuyer. This premium protects the lender should the
buyer default. They vary per state and per type of loan Kentucky home buyers qualify for. In Kentucky, upfront mortgage insurance premiums are 1.75%.
Below are the rates per type of loan:
⢠15-Year Fixed with down payment more than 10%: .45%
⢠15-Year Fixed with down payment less than 10%: .70%
⢠30-Year Fixed with down payment more than 5%: .80%
⢠30-Year Fixed with down payment less than 5%: .85%
⢠Credit scores greater than 680
⢠Greater than or equal to  5% down payment with reserves
⢠Borrowers with past foreclosures over 7 years old.
⢠Borrowers with past short sales between 5-7 years old.
⢠Borrowers who have a lot of money saved up and want to get rid of mortgage insurance within the first 5 years give or take. 20% equity position is needed for no mi
The biggest difference between conventional loans and FHA loans comes down to the mortgage insurance. Â Mortgage insurance is more expensive for FHA loans, but the trade off is a lower fixed rate than conventional loans.
On Conventional loans there is no upfront mortgage insurance like FHA, and if you have a high credit score you can possibly get a lower monthly mi premium as compared to FHA where everybody gets the same mortgage insurance premium not matter your credit score or down payment.Â
Lastly, FHA Mortgage insurance is for life of loan, whereas Conventional mortgage insurance or pmi it’s called, is discontinued once you reach the 80% threshold equity position of your home loan.
Again, I would not get too caught in FHA having mortgage insurance for life of loan, because most loans are only kept open a minimum of 5-7 years so a lot of times it may make sense to go with the lower rate and pay the mortgage insurance with FHA because most people don’t hold their mortgage for 30 years.
You can call or text me with your questions and we can compare the differences based on your credit score, down payment and income.
Equal Housing Lender. NMLS#:57916 http://www.nmlsconsumeraccess.org/Rates, terms, and program information are subject to change without notice. Subject to certain approvals, terms and conditions. This is not a commitment to lend.
Not part of any government lending agency and only lending in the State of Kentucky.
Looking at FHA loans vs Conventional loans can arm you with a lot of valuable information as these are the 2 most popular mortgage loan products today. Before getting to the content letâs look at some abbreviations that will need to be defined.
Most of the disadvantages of conventional mortgages stem around qualifications and resources needed upfront. If a borrower has significant resources most of these disadvantages are of little consequence.
The major advantage to going with an FHA loan is that there are much more lax credit standards you have to meet to obtain financing. Usually, FHA mortgages require a lower down payment, can work with lower credit scores, less elapsed time is needed if you have some credit problems (charge-offs, foreclosures) and you can use a non-occupant co-borrower or co-signer (who is a relative) to help you qualify for the loan. That way you can use blended ratios. Blended ratios are debt-to-income ratios that equally blend or combine the primary borrowerâs income and the non-occupant co-borrowerâs income and monthly payments to help get approval for the loan. Except for HomeReady (formerly Fannie Mae HomePath) mortgages, conventional loans do not allow you to use a non-occupant co-borrower.
Most of these disadvantages involve extra requirements or limits added to the process of the house (see Pros and Cons of FHA Loans). Some of these might not be disadvantages depending on oneâs personal situation, but they are extra steps to note. Since FHA mortgages are a government program, more care and consideration goes into the process, which may be better in some situations.
There are four important numbers in deciding which loan you will go with: credit scores, down payment amount, debt-to-income, and mortgage insurance percentage rate. Conventional mortgages and FHA home loans have different limits and rates which are important to examine. They also have important differences which affect the availability of properties, the condition of the properties one wishes to buy and how your down payment can be paid. So comparing FHA loans vs Conventional loans can sometimes be a tricky endeavor.
These four numbers are important to know and will affect oneâs decision to pursue a particular type of home loan. Knowing your combination of numbers as you are looking to buy a house will help buyers find the best loans for their particular situation.
Thus, if one is wanting a low-risk transaction then the FHA home loan route is a better option to pursue, even though it limits your options for homes that you might wish to buy. If one is looking to fix-up a house and raise its equity quickly then a conventional loan is going to be more beneficial because there are no requirements as to the condition of the house and itâs occupied status.
In this article, we have given you the basic parameters of FHA loans vs Conventional loans. The conventional loans are for people who have a better financial track record and can handle a larger upfront cost. Because of PMI, conventional loans are cheaper in the long run if you can put enough of a down payment to get rid of PMI. However, there are no down payment assistance programs to help you reach that goal. FHA loans are for people who are looking to build their investment and in some cases may not have a great financial track record. FHA loans have lower down payment requirements and many grants/forgivable loans to help people wanting to buy a first house in which to live for at least a few years. It is important to assess your situation and decide which mortgage is going to work better for your circumstances.
Both mortgages have a lot of benefits and drawbacks because they are designed for people with different needs. This article has hopefully helped you to get a basic understanding of the different terms and conditions of different mortgage packages when looking at FHA loans vs Conventional loans. Home buying can be an emotional roller coaster and the knowledge in this article will help you navigate the various emotional struggles of home buying.
Kentucky FHA HUD Homes for $100 Down.
via Kentucky FHA HUD Homes for $100 Down.
, FHA, FHA Back to Work Program Ky, FHA Co-signors, FHA Guidelines, fha mortgage insurance premiums, First Time Home Buyer, Homeownership Assistance Programs: Kentucky, HUD Foreclosure, HUD HOMES $100 Down, HUD REO PROPERTIES ELIGIBLE FOR THE $100 DOWN PAYMENT, Kentucky FHA HUD Homes for $100 Down, Kentucky FHA Important Links,KY FHA LOANS, Loan Limits for FHA, louisville ky fha seller contributions, Louisville Ky Home Loans,Â
FHA Loans in louisville, kentucky.
via FHA Loans in louisville, kentucky.
via FHA Loans in louisville, kentucky.
via FHA Loan.
This web site will help you understand FHA mortgage underwriting guidelines and it will also help you determine if an fha mortgage loan is right for your situation. FHA loans have always been a good opportunity for home buyers, but there are some things you should consider before you decide.
First, we need to understand what an fha mortgage is and is not. The Federal HousingAdministration (FHA) does not lend money, plan, or build housing. It is a division of theDepartment of Housing and Urban Development. The Federal Housing Administration sets standards for underwriting and construction, but its main purpose is to insure residential mortgage loans made by individual/private lenders. The basic intent was to provide FHA-insured loans to borrowers for their primary residence.
FHA loans have always been a great alternative for people who donât quite qualify for Conventional financing. The guidelines are more forgiving allowing for smaller down payments, higher debt to income ratios, some credit issues, and more sources for the down payment. The great thing is that the interest rate is only slightly higher than a conventional loan. Sometimes the interest rate is actually lower. Remember this! IF you go to a Mortgage Broker or a Bank and the rate quoted is exceptionally higher, they are charging you too much. Call around for quotes. You will usually get a better rate from a broker.
Advantages:
Disadvantages:
This web site has a ton of information that will help you better understand FHA loans. The guidelines are very complicated in some areas so I could never include them all on this site. If there is information you think should be added to this web site please send us anemail or If there is an area you have a question about just send me an email and Iâll do my best to answer it for you.
If you are interested in the guidelines for Conventional loans you should visit our other web site about mortgage underwriting guidelines. That site talks about all types of loan products and it has several Mortgage Calculators if you want to play around with the numbers. Mortgage Underwriters.com also covers Credit History, Credit Repair and the Loan Process.
HR 3221 eliminated FHA DPA (down payment assistance) as of Oct 2008, while HR 6694tried to re-instate it âjust in timeâ. Unfortunately it has not passed yet. Iâll keep you posted. Â
The FHA Secure program can help home owners who are behind on their home mortgage and facing foreclosure. This program allows the delinquent home owners to refinance their ARMS (adjustable rate mortgages).
 I have put together the underwriting guidelines for this program so you can determine if you qualify or if you are in the industry, you can learn how it works.  FHA Secure Mortgage Guidelines
This is a program developed to help homeowners stay in their homes and prevent foreclosure. Iâll let you decide if it really helps anyone. I have put up the guidelines and given you the link to the Mortgagee Letter so you too can have all the details. Honest, this program is unbelievable! H4H
| Â Closing Costs
Guidelines Blog: Good grief, how long does it take? // // Economic Bail Out! |
FHA Credit Guidelines// //
The FHA loan underwriters focus primarily on the quality of credit over the last 12 months. They are not overly concerned about minor late payments which happened 18, 24 or 36 months ago. However, all collections, excluding medical, must be paid in full prior to closing (preferably prior to application) or have a documented payment plan. They do require letters of explanation for all late payments. Underwriters are more concerned about whether the loan makes sense and that you have addressed and corrected whatever issues created the past credit problems. FHA credit guidelines can seem complicated as far as documentation but the credit guidelines or credit qualification requirements are actually slack compared to a Conventional loan. FHA Credit Score: Most loans on the market today are credit score driven with the exception of FHA which is one of the best loan programs on the market for people with minor issues that have lowered their scores. Please keep in mind that FHA may not be credit scoredriven but most lenders are. They have the prerogative to maintain higher standards than FHA and each lender has a different cut off score (the least that they will accept). Since you are here and if you are interested in understanding scores, this is the break down:
Mortgage and Rent payments: This has to be your number one priority. If you have been more than 30 days late on your rent or mortgage payment in the last 12 months you will not qualify for a Fannie Mae, Freddie Mac,  FHA, or VA loan.  There are sometimes exceptions, ⌠if you have a very high score, lots of assets, and a legitimate documented excuse, you may get a waiver. Car payment and installment loans: Your history should reflect no 60 day late payments and no more than one 30 day late to get a conforming loan. The non-conforming loans allow these and again the rate depends on how many late payments you have had. Again, FHA credit requirements prefer no lates in the last 12 months. Revolving accounts (credit cards): You should not have any payments 60 days late and no more than two payments 30 days late in the last two years for a conforming loan. FHA allows it with a good explanation as long as they did not occur in the last 12 months. Collections, Judgments, and Liens: Fannie Mae, Freddie Mac, FHA and VA require that all be paid in full and they prefer that they be at least two years old. FHA will sometimes make an exception on the length of time or if they are on a current payment plan in which case all other things must be good. Bankruptcy: Fannie Mae and Freddie require 4 years from discharge date. FHA only requires 2 years after a chapter 7, a good excuse, and re-established credit. Actually, you can qualify for an FHA loan if you are still in chapter 13 (for at least a year) and have been paying on time through the courts.  You must also get court approval which does happen often! Non conforming lender requirements vary quite a bit. As a general rule they do want to see reestablished credit unless you are putting 20% down. There are some lenders that will lend with one day out of discharge. Your credit score is very important on these programs. Again, you need a broker to sort out the details for you. Guess what, thatâs free, and no obligation. They will look at your entireportfolio and if they canât get you in something now, they will counsel you on the steps you need to take to get in a loan later. Be sure you seek out a broker that has ALL the products on the market including FHA. Foreclosure: Generally, a foreclosure of your primary residence must be at least three years old and have been caused by circumstances out of your control, such as: death of the primary wage earner, layoff, or long term serious illness. Non-conforming lenders do vary but will normally require a substantial down payment if it is less than 3 years old. Repossessions: The guidelines on this are about the same as a foreclosure except that it cannot have a deficiency balance for a conforming or FHA loan. The non-conforming market doesnât care about the balance if it is more than three years old and again, their guidelines vary from one lender to another. Student Loans: Defaulted student loans will haunt you for the rest of your life. Unless they are re-affirmed or paid off you will never get a conforming, FHA, or VA loan. However, the non-conforming market generally does not care about them at all except in extreme cases to the tune of $50k or more. Previous Marriage: Be careful here. The conforming market could care less about your divorce agreement with respect to your debt. If you signed, you are still accountable. FHA will sometimes make a wavier if you can show the divorce decree that states it is the other parties responsibility and all other things are good. (These debts will also affect your debt to income unless you can prove the other party is paying with 12 months cancelled checks.) The non-conforming lenders will normally accept the divorce decree. Credit Depth: Generally this term refers to how many trade lines you have, how long you have had them and their amounts. Most lenders want to see at least a two-year history and at least 4 trade lines. Some require one of those trade lines to have had a balance over a certain dollar amount ($5,000). In the non-conforming market these requirements vary between lenders. You can see how poor credit will cost you a lot of money in higher interest. It is important to take care of your credit and monitor it often, as it sometimes contains errors. FHA loans do not have a zero down payment mortgage but the down payment can be as little as 3.5%. Here is the exciting part, ⌠those funds (3.5%) can be aGift and come from a family member, charity, or your employer. The person providing the gift will have to provide a gift letter and their funds will have to be sourced. The provider will have to show where the money came from by supplying copies of withdrawal slips and bank statements.
|
