Category: Louisville Kentucky FHA Loans Lexington Kentucky FHA LoansElizabethtown Kentucky FHA Loans
2024 Welcome Home Grant Program for Kentucky Home Buyers $20,000
Summary:
The Welcome Home Program in Kentucky offers grants up to $25,000 for military homebuyers and up to $20,000 for other eligible buyers to assist with down payment and closing costs. Eligible homebuyers must meet income criteria and other guidelines. Properties eligible for the grant must be the buyer’s primary residence and have a legally enforceable retention mechanism. Prospective homebuyers should contact an FHLB Cincinnati Member financial institution for more program information and eligibility details. Various other programs and grants are also available for first-time homebuyers in Kentucky. For further information, contact a Kentucky Mortgage Lender.
Kentucky Down payment assistance loans are available up to $20,000 for Mortgage with Welcome Home Grant 2024
Information for Kentucky Homebuyers
Welcome Home Program Grant Program for Kentucky Home buyers in 2024
The Federal Home Loan Bank of Cincinnati (FHLB Cincinnati) offers grants of up to $25,000 for honorably discharged veterans, surviving spouses of military personnel, and active duty military homebuyers and up to $20,000 for all other homebuyers to assist with down payment and closing costs for income eligible homebuyers through the Welcome Home Program (WHP).
Kentucky Homebuyers must apply and qualify for a mortgage loan with one of our Member financial institutions to utilize the grant.
Who are Eligible Homebuyers in Kentucky for the Welcome Grant?
A Kentucky homebuyer would be eligible for the Welcome Home grant if all of the following guidelines are met:
The total income for all occupants who will reside in the home is at or below 80 percent of the Mortgage Revenue Bond (MRB) limit for the county and state where the property is located;
A fully executed (signed by buyer and seller) purchase contract on an eligible property is in hand;
The homebuyer has at least $500 of their own funds to contribute towards down payment and/or closing costs; and,
If a first-time homebuyer (typically anyone who has not owned a home in the last three years), a satisfactory homebuyer counseling course is completed prior to the loan closing. Note: Applicants do not have to be first-time homebuyers.
A fully executed (signed by buyer and seller) purchase contract on an eligible property is in hand;
The homebuyer has at least $500 of their own funds to contribute towards down payment and/or closing costs; and,
If a first-time homebuyer (typically anyone who has not owned a home in the last three years), a satisfactory homebuyer counseling course is completed prior to the loan closing. Note: Applicants do not have to be first-time homebuyers.
What is an Eligible Property?
A property would be eligible if all of the following guidelines are met:
The property will be the homebuyer’s primary residence;
The property is a single family, townhome, condominium, duplex, multi-unit (up to four family units) or a qualified manufactured home. (Manufactured homes may be eligible if they are taxed as real estate and affixed to a permanent foundation); and,
The property is subject to a legally enforceable five-year retention mechanism, included in the Deed or as a Declaration of Restrictive Covenants to the Deed, requiring the FHLB Cincinnati be given notice of any refinancing, sale, foreclosure, deed in-lieu of foreclosure, or change in ownership during the five year retention period.
The property is a single family, townhome, condominium, duplex, multi-unit (up to four family units) or a qualified manufactured home. (Manufactured homes may be eligible if they are taxed as real estate and affixed to a permanent foundation); and,
The property is subject to a legally enforceable five-year retention mechanism, included in the Deed or as a Declaration of Restrictive Covenants to the Deed, requiring the FHLB Cincinnati be given notice of any refinancing, sale, foreclosure, deed in-lieu of foreclosure, or change in ownership during the five year retention period.
How Do I Apply?
For more program information, homebuyers should contact a FHLB Cincinnati Member financial institution.
A list of Members is available at👉 List of Kentucky Mortgage Lenders for the Welcome Grant Home Program for $20,000 for 2024 KY Homebuyers
Kentucky has many programs and grants for first-time home buyers with no money down home loans and down payment assistance programs for 2024
,see list below and let me know if you have any questions at 502-905-3708– call or text
or email me at kentuckyloan@gmail.com
LIST BELOW👇
- HUD Community Development Block Grants (CDBG) — Kentucky contacts: HUD provides grant money to communities and those funds may be used to assist home buyers
- HUD HOME Program — Kentucky contacts: HUD provides grant money to communities designated as participating jurisdictions for assisting home buyers, rental assistance, and other housing initiatives
- Community Ventures Corporation Kentucky Home Financing
- The Kentucky Housing Corporation offers:
- Habitat for Humanity: Through volunteer labor and donations of money and materials, Habitat builds and rehabilitates simple, decent houses with the help of the homeowner (partner) families
- Federal Home Loan Bank of Cincinnati: Serves Kentucky residents by offering various home buying assistance programs, including Welcome Home grants. For more information, you may call 1 (888) 345-2246
- Kentucky Area Development Districts (ADDs): Contact your local ADD to find out more about local home buying assistance programs
- Kentucky Association for Community Action: Helps to fund housing programs for low-income residents
- Federal Appalachian Housing Enterprise (FAHE): Provides housing assistance in rural, low-income, Appalachian communities
- Housing Partnership, Inc.: Provides affordable housing services for residents of Jefferson County
- Secondary financing/down payment assistance programs are listed by state
- USDA Rural Development: Home buying loan programs that reduce the cost of homeownership for low and moderate-income families
Ask your loan officer about these program
Kentucky First Time Home Buyer Common Questions and Answers:
∘ WHAT KIND OF CREDIT SCORE DO I NEED TO QUALIFY FOR DIFFERENT FIRST TIME HOME BUYER LOANS IN KENTUCKY?
Answer. Most lenders will wants a middle credit score of 580 to 620 for KY First Time Home Buyers looking to go no money down. The two most used no money down home loans in Kentucky being USDA Rural Housing and KHC with their down payment assistance will want a 620 middle score on their programs.
If you have access to 3.5% down payment, you can go FHA and secure a 30 year fixed rate mortgage with some lenders with a 580 credit score. Even though FHA on paper says they will go down to 500 credit score with at least 10% down payment, you will find it hard to get the loan approved because lenders will create overlays to protect their interest and maintain a good standing with FHA and HUD.
Another popular no money down loan is VA. Most VA lenders will want a 580 middle credit score but like FHA, VA on paper says they will go down to a 500 score, but good luck finding a lender for that scenario.
A lot of times if your scores are in the high 500’s or low 600’s range, we can do a rapid rescore and get your scores improved within 30 days.
∘ DOES IT COSTS ANYTHING TO GET PRE-APPROVED FOR A MORTGAGE LOAN?
Answer: Most lenders will not charge you a fee to get pre-approved, but some lenders may want you to pay for the credit report fee upfront. Typically costs for a tri-merge credit report for a single borrower runs about $50 or less. Maybe higher if more borrowers are included on the loan application.
∘ HOW LONG DOES IT TAKE TO GET APPROVED FOR A MORTGAGE LOAN IN KENTUCKY?
Answer: Typically if you have all your income and asset documents together and submit to the lender, they typically can get you a pre-approval through the Automated Underwriting Systems within 24 hours.
They will review credit, income and assets and run it through the different AUS (Automated Underwriting Systems) for the template for your loan pre-approval. Fannie Mae uses DU, or Desktop Underwriting, FHA and VA also use DU, and USDA uses a automated system called GUS. GUS stands for the Guaranteed Underwriting System.
If you get an Automated Approval, loan officers will use this for your pre-approval. If you have a bad credit history, high debt to income ratios, or lack of down payment, the AUS will sometimes refer the loan to a manual underwrite, which could result in a longer turn time for your loan pre-approval answer
∘ ARE THERE ANY SPECIAL PROGRAMS IN KENTUCKY THAT HELP WITH DOWN PAYMENT OR NO MONEY DOWN LOANS FOR KY FIRST TIME HOME BUYERS?
Answer: There are some programs available to KY First Time Home Buyers that offer zero down financing: KHC, USDA, VA, Fannie Mae Home Possible and HomePath, HUD $100 down and City and Welcome Grants are all available to Kentucky First Time Home buyers if you qualify for them.
∘ WHEN CAN I LOCK IN MY INTEREST RATE TO PROTECT IT FROM GOING UP WHEN I BUY MY FIRST HOME?
Answer: You typically can lock in your mortgage rate and protect it from going up once you have a home picked-out and under contract. You can usually lock in your mortgage rate for free for 90 days, and if you need more time, you can extend the lock in rate for a fee to the lender in case the home buying process is taking a longer time.
The longer the term you lock the rate in the future, the higher the costs because the lender is taking a risk on rates in the future.
Interest rates are kind of like gas prices, they change daily, and the general trend is that they have been going up since the Presidential election in November 2016.
∘ HOW MUCH MONEY DO I NEED TO PAY TO CLOSE THE LOAN?
Answer: Depending on which loan program you choose, the outlay to close the loan can vary. Typically you will need to budget for the following to buy a home: Good faith deposit, usually less than $500 which holds the home for you while you close the loan. You get this back at closing; Appraisal fee is required to be paid to lender before closing. Typical costs run around $500-$650 for an appraisal fee; home inspection fees.
Even though the lender’s programs don’t require a home inspection, a lot of buyers do get one done. The costs for a home inspection runs around $300-$400. Lastly, termite report. They are very cheap, usually $50 or less, and VA requires one on their loan programs. FHA, KHC, USDAS, Fannie Mae does not require a termite report, but most borrowers get one done.
There are also lender costs for title insurance, title exam, closing fee, and underwriting fees that will be incurred at closing too. You can negotiated the seller to pay for these fees in the contract, or sometimes the lender can pay for this with a lender credit. The lender has to issue a breakdown of the fees you will incur on your loan pre-approval.
HOW LONG IS MY PRE-APPROVAL GOOD FOR ON A KENTUCKY MORTGAGE LOAN?
Answer: Most lenders will honor your loan pre-approval for 60 days. After that, they will have to re-run your credit report and ask for updated pay stubs, bank statements, to make sure your credit quality and income and assets has not changed from the initial loan pre-approval.
HOW MUCH MONEY DO I HAVE TO MAKE TO QUALIFY FOR A MORTGAGE LOAN IN KENTUCKY?
Answer: The general rule for most FHA, VA, KHC, USDA and Fannie MAe loans is that we run your loan application through the Automated Underwriting systems, and it will tell us your max loan qualifying ratios.
There are two ratios that matter when you qualify for a mortgage loan. The front-end ratio, is the new house payment divided by your gross monthly income. The back-end ratio, is the new house payment added to your current monthly bills on the credit report, to include child support obligations and 401k loans.
Car insurance, cell phone bills, utilities bills does not factor into your qualifying rations.
If the loan gets a refer on the initial desktop underwriting findings, then most programs will default to a front end ratio of 31% and a back-end ratio of 43% for most government agency loans that get a refer. You then take the lowest payment to qualify based on the front-end and back-end ratio.
So for example, let’s say you make $3000 a month and you have $400 in monthly bills you pay on the credit report. What would be your maximum qualifying house payment for a new loan?
Take the $3000 x .43%= $1290 maximum back-end ratio house payment. So take the $1290-$400= $890 max house payment you qualify for on the back-end ratio.
Then take the $3000 x .31%=$930 maximum qualifying house payment on front-end ratio.
So now your know! The max house payment you would qualify would be the $890, because it is the lowest payment of the two ratios.
Kentucky Welcome Home Grant 2024 Income Limits for the $20,000 Grant.
see below:👇 hit link for Welcome Home Grants Program 2024
2024 Kentucky Welcome Home Grant Income Limits
Use the 80% limits for the Welcome Home Program
Use the 100% limits for the Disaster Reconstruction Program
| 100% limits | 80% limits | |||||
| 1-2 Persons | 3 + Persons | 1-2 Persons | 3 + Persons | |||
| Adair | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 | ||
| Allen | $ 78,600 | $ 91,420 | $ 62,880 | $ 73,136 | ||
| Anderson | $ 86,270 | $ 99,210 | $ 69,016 | $ 79,368 | ||
| Ballard | $ 80,400 | $ 93,800 | $ 64,320 | $ 75,040 | ||
| Barren | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 | ||
| Bath | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 | ||
| Bell | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 | ||
| Boone | $ 101,100 | $ 116,265 | $ 80,880 | $ 93,012 | ||
| Bourbon | $ 89,300 | $ 102,695 | $ 71,440 | $ 82,156 | ||
| Boyd | $ 83,040 | $ 96,880 | $ 66,432 | $ 77,504 | ||
| Boyle | $ 80,760 | $ 94,220 | $ 64,608 | $ 75,376 | ||
| Bracken | $ 101,100 | $ 116,265 | $ 80,880 | $ 93,012 | ||
| Breathitt | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 | ||
| Breckinridge | $ 87,410 | $ 100,521 | $ 69,928 | $ 80,417 | ||
| Bullitt | $ 89,700 | $ 103,155 | $ 71,760 | $ 82,524 | ||
| Butler | $ 78,600 | $ 91,420 | $ 62,880 | $ 73,136 | ||
| Caldwell | $ 84,480 | $ 98,560 | $ 67,584 | $ 78,848 | ||
| Calloway | $ 82,560 | $ 96,320 | $ 66,048 | $ 77,056 | ||
| Campbell | $ 101,100 | $ 116,265 | $ 80,880 | $ 93,012 | ||
| Carlisle | $ 78,600 | $ 90,860 | $ 62,880 | $ 72,688 | ||
| Carroll | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 | ||
| Carter | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 | ||
| Casey | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 | ||
| Christian | $ 87,590 | $ 100,728 | $ 70,072 | $ 80,582 | ||
| Clark | $ 89,300 | $ 102,695 | $ 71,440 | $ 82,156 | ||
| Clay | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 | ||
| Clinton | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 | ||
| Crittenden | $ 83,760 | $ 97,720 | $ 67,008 | $ 78,176 | ||
| Cumberland | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 | ||
| Daviess | $ 86,950 | $ 99,992 | $ 69,560 | $ 79,994 | ||
| Edmonson | $ 86,650 | $ 99,647 | $ 69,320 | $ 79,718 | ||
| Elliott | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 | ||
| County | 100% limits | 80% limits | ||
| 1-2 Persons | 3 + Persons | 1-2 Persons | 3 + Persons | |
| Estill | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Fayette | $ 89,300 | $ 102,695 | $ 71,440 | $ 82,156 |
| Fleming | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Floyd | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Franklin | $ 85,430 | $ 98,244 | $ 68,344 | $ 78,595 |
| Fulton | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Gallatin | $ 101,100 | $ 116,265 | $ 80,880 | $ 93,012 |
| Garrard | $ 87,210 | $ 100,291 | $ 69,768 | $ 80,233 |
| Grant | $ 79,560 | $ 92,820 | $ 63,648 | $ 74,256 |
| Graves | $ 83,160 | $ 97,020 | $ 66,528 | $ 77,616 |
| Grayson | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Green | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Greenup | $ 83,040 | $ 96,880 | $ 66,432 | $ 77,504 |
| Hancock | $ 86,950 | $ 99,992 | $ 69,560 | $ 79,994 |
| Hardin | $ 86,750 | $ 99,762 | $ 69,400 | $ 79,810 |
| Harlan | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Harrison | $ 87,250 | $ 100,337 | $ 69,800 | $ 80,270 |
| Hart | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Henderson | $ 87,300 | $ 100,395 | $ 69,840 | $ 80,316 |
| Henry | $ 89,700 | $ 103,155 | $ 71,760 | $ 82,524 |
| Hickman | $ 79,560 | $ 92,820 | $ 63,648 | $ 74,256 |
| Hopkins | $ 80,640 | $ 94,080 | $ 64,512 | $ 75,264 |
| Jackson | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Jefferson | $ 89,700 | $ 103,155 | $ 71,760 | $ 82,524 |
| Jessamine | $ 89,300 | $ 102,695 | $ 71,440 | $ 82,156 |
| Johnson | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Kenton | $ 101,100 | $ 116,265 | $ 80,880 | $ 93,012 |
| Knott | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Knox | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Larue | $ 86,750 | $ 99,762 | $ 69,400 | $ 79,810 |
| Laurel | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Lawrence | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Lee | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Leslie | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Letcher | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Lewis | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Lincoln | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Livingston | $ 82,320 | $ 96,040 | $ 65,856 | $ 76,832 |
| Logan | $ 80,760 | $ 94,220 | $ 64,608 | $ 75,376 |
| Lyon | $ 87,310 | $ 100,406 | $ 69,848 | $ 80,325 |
| County | 100% limits | 80% limits | ||
| 1-2 Persons | 3 + Persons | 1-2 Persons | 3 + Persons | |
| McCracken | $ 87,130 | $ 100,199 | $ 69,704 | $ 80,159 |
| McCreary | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| McLean | $ 86,950 | $ 99,992 | $ 69,560 | $ 79,994 |
| Madison | $ 86,910 | $ 99,946 | $ 69,528 | $ 79,957 |
| Magoffin | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Marion | $ 80,760 | $ 94,220 | $ 64,608 | $ 75,376 |
| Marshall | $ 86,030 | $ 98,934 | $ 68,824 | $ 79,147 |
| Martin | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Mason | $ 85,920 | $ 100,240 | $ 68,736 | $ 80,192 |
| Meade | $ 85,790 | $ 98,658 | $ 68,632 | $ 78,926 |
| Menifee | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Mercer | $ 86,730 | $ 99,739 | $ 69,384 | $ 79,791 |
| Metcalfe | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Monroe | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Montgomery | $ 78,600 | $ 91,140 | $ 62,880 | $ 72,912 |
| Morgan | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Muhlenberg | $ 78,600 | $ 91,700 | $ 62,880 | $ 73,360 |
| Nelson | $ 85,170 | $ 97,945 | $ 68,136 | $ 78,356 |
| Nicholas | $ 78,600 | $ 90,860 | $ 62,880 | $ 72,688 |
| Ohio | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Oldham | $ 89,700 | $ 103,155 | $ 71,760 | $ 82,524 |
| Owen | $ 78,600 | $ 91,700 | $ 62,880 | $ 73,360 |
| Owsley | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Pendleton | $ 101,100 | $ 116,265 | $ 80,880 | $ 93,012 |
| Perry | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Pike | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Powell | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Pulaski | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Robertson | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Rockcastle | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Rowan | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Russell | $ 78,600 | $ 90,860 | $ 62,880 | $ 72,688 |
| Scott | $ 89,300 | $ 102,695 | $ 71,440 | $ 82,156 |
| Shelby | $ 92,700 | $ 106,605 | $ 74,160 | $ 85,284 |
| Simpson | $ 82,920 | $ 96,740 | $ 66,336 | $ 77,392 |
| Spencer | $ 89,700 | $ 103,155 | $ 71,760 | $ 82,524 |
| Taylor | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Todd | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Trigg | $ 87,590 | $ 100,728 | $ 70,072 | $ 80,582 |
| Trimble | $ 86,770 | $ 99,785 | $ 69,416 | $ 79,828 |
| County | 100% limits | 80% limits | ||
| 1-2 Persons | 3 + Persons | 1-2 Persons | 3 + Persons | |
| Union | $ 78,600 | $ 91,420 | $ 62,880 | $ 73,136 |
| Warren | $ 86,650 | $ 99,647 | $ 69,320 | $ 79,718 |
| Washington | $ 87,090 | $ 100,153 | $ 69,672 | $ 80,122 |
| Wayne | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Webster | $ 78,600 | $ 90,390 | $ 62,880 | $ 72,312 |
| Whitley | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Wolfe | $ 94,320 | $ 110,040 | $ 75,456 | $ 88,032 |
| Woodford | $ 89,300 | $ 102,695 | $ 71,440 | $ 82,156 |
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).
4 Things to Know about buying a house and getting a Kentucky Mortgage Loan approval
Kentucky FHA Loan Requirements for 2024
Originally posted on Kentucky FHA Mortgage Lender:
Kentucky FHA Loan Requirements The requirements for Kentucky FHA loans are set by HUD. Borrowers must have a steady employment history of the last two years within the same industry or line of work. Recent college graduates can use their transcripts to supplant the 2 year work history…
Kentucky FHA Loan Requirements for 2024 to include Credit Fico Scores, Down Payment, Income and Job history
FHA
An FHA loan is a mortgage issued by federally qualified lenders and insured by the Federal Housing Administration (FHA). FHA loans are designed for low-to-moderate income borrowers who are unable to make a large down payment.
- Minimum Credit Score is 500 with at least 10% down
- Minimum Credit Score is 580 if you put less than 10% down
FHA Guidelines
- Upfront and Monthly Mortgage Insurance is required regardless of the Loan to Value
- FHA Loans are only available for financing primary residences
- Maximum Debt to Income Ratio of 50% (unless mitigating factors justify allowing a higher DTI)
Kentucky FHA Loan RequirementsKentucky FHA Loan Requirements
The requirements for Kentucky FHA loans are set by HUD.
- Borrowers must have a steady employment history of the last two years within the same industry or line of work. Recent college graduates can use their transcripts to supplant the 2-year work history rule as long as it makes sense.
- Self-Employed will need a 2-year history of tax returns filed with IRS. They will take a 2-year average.
- FHA requires a 3.5% down payment. Can be gifted from family member or from retirement savings plan, or money saved-up. Any type of cash deposits is not allowed for down payments. No exceptions to this rule!! This is one of the biggest issues I see in FHA underwriting nowadays.
- FHA loans are for primary residence occupancy. Not rental houses.
- Borrowers must have a property appraisal from a FHA-approved appraiser.
- Borrowers’ front-end ratio (mortgage payment plus HOA fees, property taxes, mortgage insurance, homeowners’ insurance) needs to be less than 31 percent of their gross income, typically. You may be able to get approved with as high a percentage as 43 percent. If the Automated Underwriting System gives you an Approved Eligible you can go higher on the debt ratios
- Borrowers must have a minimum credit score of 580 for maximum financing with a 3.5% down payment
- Borrowers must have a minimum credit score of 500-579 for maximum LTV of 90 percent with a minimum down payment of 10 percent. Most lenders will not go below 580 to 620 score, and very few lenders will go to 580 score. It’s best to work on getting your scores up before you apply or work with a loan officer to improve them.
- 2 years removed from Chapter 7 is required with good pay history after bankruptcy
- 1 year removed from Chapter 13 is okay with an excellent pay history with the Chapter 13 plan and permission from trustee. You will need to qualify with the Chapter 13 payment along with new house payment. Again, scores will play into your loan pre-approval.
- Typically, borrowers must be three years out of foreclosure and have re-established good credit. Exceptions can be made if there were extenuating circumstances and you’ve improved your credit. If you were unable to sell your home because you had to move to a new area, this does not qualify as an exception to the three-year foreclosure guideline.
FHA
Low Down Payment which can be 100% gift from family member or Grant Program
Seller can pay closing costs-Maximum 6% of purchase price
There is maximum mortgage amount for each county. Check FHA loan limit for your county.
Non-occupant co-signers are allowed on this program.
FHA Approved Condos-Single family home-2-4 unit properties, and PUDs are eligible.
Fast automated underwriting approval available. Also, the file can be manually underwritten by a live person to get loan approval if you do not receive approval through automated underwriting system.FHA Foreclosure Program
Must be HUD Owned property or FHA Foreclosure in HUD Participating Communities
$100 Down Payment than standard FHA program
580 minimum credit score
Single family, 1-4 unit properties, HUD approved condominiums, and PUDS eligible2. Kentucky Housing Corporation Down Payment Assistance for 2024.
Kentucky Down payment assistance loans are available up to $10,000 for Mortgage
KHC recognizes that down payments, closing costs, and prepaids are stumbling blocks for many potential home buyers. We offer a special loan program to help with those. Your KHC-approved lender can help you apply.
Eligibility: Both first-time and repeat home buyers purchasing a single-family dwelling. Purchase price can be no more than $481,176. Applicant’s income must be within applicable secondary market limits in effect. If KHC’s Homebuyer Tax Credit is used, then household income must be under the Homebuyer Tax Credit income limits.
Mortgage Revenue Bond (MRB) First Mortgage Products Eligibility: Must be a first-time home buyer, unless purchasing a single-family dwelling in a targeted county. Purchase price can be no more than $481,176. Gross annual household income must be within applicable limits in effect. All non-borrowing occupants age 18 or older must disclose income and complete Non- Borrowing Occupant Form.KHC ELIGIBILITY AND CREDIT STANDARDS OVERVIEW (Not intended to be an all-inclusive list.)
Home Buyer Eligibility
•
KHC can help both first time and repeat home buyers statewide.
•
Must be a U.S. citizen or legal status to be in U.S.
•
Applicant’s income ONLY through Secondary Market.
•
Property must be the borrower’s principal residence.
•
Borrower cannot own any other residential property at time closing for all loans with MRB Funding.
•
Any Borrower that meets both the income and purchase price limit can have access to Down Payment Assistance.
Kentucky Housing Credit Standards
•
620 minimum credit score required for FHA, VA, & RHS.
•
660 minimum credit score required for Conventional.
•
Debt ratios: 40/50%
•
Collections in most cases do not need to be paid-off in full.
•
Bankruptcies and foreclosures must be discharged two to seven years.
•
Non-taxable income can be grossed-up.
Property Eligibility
•
Both new and existing property.
•
Both new & existing Manufactured Housing.
•
With RHS only new construction Manufactured housing is allowed.
•
Purchase price limit of $481,176 for Secondary Market, MRB Loans, and Tax Credit.
•
Full appraisal required on all KHC loans.
•
With Existing Property, VA is the only loan product that requires a termite inspection.
•
A termite soil treatment certificate is required on ALL new constructionRegular Down Payment Assistance Programs (DAP) Only home buyers obtaining a Kentucky Housing Corporation first mortgage are eligible for DAP funds.Interest Rate with DAP applicable.Eligible KHC Mortgages FHA, RHS, VA, HFA Preferred, & HFA Preferred Plus 80 Income EligibilitySecondary Market or Mortgage Revenue Bond Property Eligibility New and Existing PropertiesBorrower Eligibility First-time and Repeat Home Buyers Amount Up to $10,000Not required to be at maximum LTV first mortgage amount Terms 3.75% amortized over 10 years Purchase Price Limit $481,176 AUSBorrower must qualify with additional monthly payment.With AUS approval, can go up to 40/50% with all loans.Required Repairs Buyer or seller must use OWN funds to pay for repairs DAPMortgage Revenue Bonds (MRB)
- Informational Flyer
- First-time homebuyers statewide in non-targeted areas
- First-time and repeat homebuyers statewide in targeted areas
- 30-year fixed interest rate
- Principal residence ONLY
- Purchase Price Limit: $481,176
- Borrower must meet KHC’s MRB Income Limits
- Insured by the Federal Housing Administration
- 3.5 percent down payment
- KHC DAP applicable
- Upfront and monthly mortgage insurance
- Minimum credit score of 620
- Guaranteed by the Veterans Administration for qualified military veterans
- No down payment if the property appraises for the sales price or greater
- KHC DAP applicable
- Minimum credit score of 620
- No monthly mortgage insurance payments
- Guaranteed by Rural Housing Services (RHS)
- Home must be located in a rural area as defined by RHS
- No down payment if the property appraises for the sales price or greater
- KHC DAP applicable
- Upfront and monthly mortgage insurance
- Minimum credit score of 620
Secondary Market Funding Source
- First-time and repeat homebuyers statewide
- 30-year fixed interest rate
- Principal residence ONLY
- Purchase Price Limit: $481,176
- Borrower must meet KHC’s Secondary Market Income Limits
- Minimum credit score of 660
- 3 percent down payment
- Monthly mortgage insurance (charter coverage)
- KHC DAP applicable
- No minimum borrower contribution
- No reserves required
- 80 percent AMI income
- Minimum credit score of 660
- 3 percent down payment
- Monthly mortgage insurance (standard coverage)
- KHC DAP applicable
- No minimum borrower contribution
- No reserves required
- Secondary Market Income limits apply
- Insured by the Federal Housing Administration
- 3.5 percent down payment
- KHC DAP applicable
- Upfront and monthly mortgage insurance
- Minimum credit score of 620
Refinance Options (Available only through Secondary Market)
- Credit qualifying Streamline Refinance and Rate/Term Refinance
- Insured by the Federal Housing Administration
- Cash back to borrower not to exceed $500
- Upfront and monthly mortgage insurance
- Minimum credit score of 620
- Guaranteed by the Veterans Administration for qualified military veterans
- No down payment if the property appraises for the sales price or greater
- KHC DAP applicable
- Minimum credit score of 620
- No monthly mortgage insurance payments
Refinance Options (Available only through Secondary Market)
- VA IRRRL
- 620 minimum credit score
- No appraisal required
- 30-year term
- VA existing loan
- Guaranteed by Rural Housing Services (RHS)
- Home must be located in a rural area as defined by RHS
- No down payment if the property appraises for the sales price or greater
- KHC DAP applicable
- Upfront and monthly mortgage insurance
- Minimum credit score of 620
Refinance Options (Available only through Secondary Market)
- RHS Streamlined-Assist Refinance Program
- 620 minimum credit score
- No appraisal required
- Must have made timely mortgage payments for the last 12 months
- 30-year term
- RHS existing 502 guaranteed loan
Joel Lobb (NMLS#57916)
Senior Loan OfficerAmerican Mortgage Solutions, Inc.
10602 Timberwood Circle Suite 3
Louisville, KY 40223
Company ID #1364 | MB73346Text/call 502-905-3708
kentuckyloan@gmail.comIf 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#57916
— 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.
Kentucky FHA Loan Requirements
The requirements for Kentucky FHA loans are set by HUD.
- Borrowers must have a steady employment history of the last two years within the same industry or line of work. Recent college graduates can use their transcripts to supplant the 2 year work history rule as long as it makes sense.
- Self-Employed will need a 2 year history of tax returns filed with IRS. They will take a 2 year average.
- FHA requires a 3.5% down payment. Can be gifted from family member or from retirement savings plan, or money saved-up. Any type of cash deposits are not allowed for down payments. No exceptions to this rule!! This is one of the biggest issues I see in FHA underwriting nowadays.
- FHA loans are for primary residence occupancy. Not rental houses.
- Borrowers must have a property appraisal from a FHA-approved appraiser.
- Borrowers’ front-end ratio (mortgage payment plus HOA fees…
View original post 453 more words
Kentucky First-Time Home Buyer Loan Programs
Kentucky First Time Home Buyer Loan Programs for 2024
Kentucky First-Time Home Buyer Loan Programs
There are 4 basic things that a Kentucky-First Time Homebuyers in 2024 needs to show a lender in order to get approved for a mortgage. Each category has so many what-ifs and sub plots that each box can read as its own novel. In other words, each category has so many variables that can affect what it takes to get approved, but without further adieu here are the four categories in no particular order as each without any of these items, you’re pretty much dead in the water:
1. Income
You need income. You need to be able to afford the home. But what is acceptable income? Let’s just say that there are two ratios mortgage underwriters look at to qualify you for mortgage payment:
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 is 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.
What qualifies as income? Basically, it’s income that has at least a proven, two-year history of being received and pretty high assurances that the income is likely to continue for at least three years. What’s not acceptable? Unverifiable cash income, short term income and income that’s not likely to continue like unemployment income, student loan aid, VA education benefits, or short term disability are not allowed for a mortgage loan.
2. Assets
What the mortgage underwriter is looking for here is how much can you put down and secondly, how much will you have in reserves after the loan is made to help offset any financial emergencies in the future.
Do you have enough assets to put the money forth to qualify for the down payment that the particular program asks for? The only 100% financing or no money down loans still available in Kentucky for home buyers are available through USDA, VA, and KHC or Kentucky Housing Loans. Most other home buyers that don’t qualify for the no money down home loans mentioned above, will turn to the FHA program. FHA loans currently require a 3.5% down payment.
Kentucky Home buyers that have access to putting down at least 5% or more, will usually turn to Fannie Mae or Freddie Mac mortgage programs so they can get better pricing when it comes to mortgage insurance.
These assets need to be validated through bank accounts, 401k or retirements account and sometimes gifts from relatives or employer… Can you borrow the down payment? Sometimes. Generally, if you’re borrowing a secured loan against a secured asset you can use that. But rarely can cash be used as an asset. FHA will allow for gifts from relatives for down payments with little as 3.5% down but Fannie Mae will require a 20% down payment when a gift is being used for the down payment on the home.
The down payment scenarios listed above are for Kentucky Primary Residences only. There are stricter down payment requirements for investment homes made in Kentucky.
3. Credit
- Kentucky FHA Mortgage loan credit score requirements:
- The minimum credit score is 500 for Kentucky FHA loans. However please keep in mind these two things: 1. Lenders credit their own overlays to increase the credit score threshold, most being 580 to 620, and secondly, if your credit score is below 580, you would need 10% minimum down payment, and if the credit score is over 580, then you can go with the minimum 3.5% down payment.
- Obviously, if you have a higher credit score, this will increase your chances of getting approved for a Kentucky FHA Mortgage and possibly better rates and closing costs options.
- Kentucky VA Mortgage loans requirements :
- VA does not have a minimum credit score requirement, but if the credit score is below 620 few lenders will do the loan, but I am set up with several Kentucky VA lenders where I have closed them down to a 580 credit score, but the borrower had good compensating factors such as large down payment, low dti ratios, good job history and good residual income with no previous bankruptcies or foreclosures.
- I would suggest if your credit scores are below 580, I would suggest on working on getting the scores up before you applied for a VA mortgage loan.
- A lot of lenders will do a rapid rescore which in some cases can increase your credit scores in as little as 7-10 working days.
- The federal Department of Veterans Affairs (VA) guarantees loans for current and former members of the military and their families. VA loans provide very favorable terms to eligible borrowers and have limited qualifying requirements. You can get a VA loan with no down payment so long as the home isn’t worth more than you pay for it, and there’s no minimum credit score to qualify. You also don’t have to pay for mortgage insurance, although you do have to pay an up-front funding fee of between .5% and 3.3% of the loan amount unless you fall within an exception for disabled vets or military widows or widowers.
- Kentucky USDA Mortgage credit score requirements:
- According to their guidelines, USDA will go down to a 580 credit score, but most lenders will want a 640 credit score. USDA uses an online system to underwrite the risk of the loan, and scores under 640 are very difficult to get approved.
- Validating the Credit Score. Two or more eligible trade lines are necessary to validate an applicant’s credit report score. Eligible trade lines consist of credit accounts (revolving, installment etc.) with at least 12 months of repayment history reported on the credit report. At least one applicant whose income or assets are used for qualification must have a valid credit report score
- The Rural Housing Service (RHS) operates under the federal Department of Agriculture to guarantee loans for rural home-buyers with limited income who can’t obtain conventional financing. The upside is that Kentucky USDA loans require no down payment. The downside is that they charge a steep up-front fee of 1% of the loan amount (which can be paid off over the entire loan term) and an annual fee of 0.35%.
- Kentucky Fannie Mae and Freddie Mac Conventional Credit Score Requirements
These are considered “conventional loans’ that can be often be obtained with a 3% to 5% down payment. Of course, there are higher standards for conventional home financing.
The most common minimum credit score requirement to get approved today is a 620 FICO. This type of score is typical for people that have high credit card balances or a few delinquent payments in their past. The general consensus on Freddie Mac and Fannie Mae loans in Kentucky is that a 620 score is the entry-point to qualify, but you will need thorough documentation of income with credit scores in the 620 to 640 range.
You will have a better shot to be approved for a mortgage-backed by Fannie or Freddie with a 680-credit score and less strenuous underwriting.
- Competitive Mortgage Rates and Fees
- Monthly Mortgage Insurance Is Not Always Required
- Ideal for First Time Home Buyers with Good Credit
As far as previous Bankruptcies and foreclosures:
Kentucky FHA Mortgage Loans currently requires 3 years removal from a foreclosure or short sale and 2 years on a bankruptcy with good re-established credit.
Kentucky Fannie Mae Mortgage Loans currently requires 4 years removal from bankruptcy, and 7 years on a foreclosure.
Kentucky VA Mortgage Loans currently requires 2 years of removal from bankruptcy or foreclosure with good re established credit.
Kentucky USDA loans require 3 years of removal from bankruptcy and foreclosure with good reestablished credit.
4. Appraisal
Generally, there’s nothing you can do to affect this. The bottom line here is…..” is the value of the house at least the value of what you’re paying for it?” If not, then not good things start to happen. Generally, you’ll find fewer issues with values on purchase transactions, because, in theory, the realtor has done an accurate job of valuing the house prior to taking the listing. The big issue comes in refinancing. In purchase transactions, the value is determined as the
Lower of the value or the contract price!!!
That means that if you buy a $1,000,000 home for $100,000, the value is established at $100,000. Conversely, if you buy a $200,000 home and the value comes in at $180,000 during the appraisal, then the value is established at $180,000. Big issues….Talk to your loan officer.
For each one of these boxes, there are over 1,000 things that can affect if a borrower has reached the threshold to complete that box. So..talk to a great loan officer. There are so many loan officers that don’t know what they’re doing. But, conversely, there’s a lot of great ones as well. Your loan is so important! Get a great lender so that you know, for sure, that the loan you want, can be closed on!
—
Joel Lobb
Mortgage Loan Officer
Mortgage Loan Officer
Individual NMLS ID #57916
American Mortgage Solutions, Inc.
Text/call: 502-905-3708
fax: 502-327-9119
email: kentuckyloan@gmail.com
email: kentuckyloan@gmail.com
Kentucky First-Time Homebuyer Loan Programs for FHA, VA, KHC and USDA Mortgage Loans in Kentucky 