Lenders continue to lower FICO requirements for new homebuyers


Fico Score Requirements for Mortgage Lenders in Kentucky

 

The average agency FICO score for banks is high at 745, compared to 713 at nonbank lending institutions.  Both show FICO requirements are on the way down, but it’s more pronounced at the nonbanks. Here’s why.

Source: Lenders continue to lower FICO requirements for new homebuyers

 

The nation’s major banks are continuing to walk away from FHA-backed mortgages, according to the Urban Institute’s Housing Finance Policy Center February Chartbook.

And not only are nonbanks stepping in to take over the space, overall, they are continuing to ease access to credit.

“Bank and nonbank FICO scores reveal that nonbanks brought the Agency median FICO down four points to 726 between November 2018 and January 2019,” the Urban Institute said in an email.

The average agency FICO score for banks is high at 745, compared to 713 at nonbank lending institutions.  Both show FICO requirements on the way down, but it’s more pronounced at the nonbanks. Why?

Nonbanks are also more accommodating for increasing debt-to-income ratios, even as mortgage rates overall inch upward, driving up monthly mortgage payments for borrowers.

“The median LTV for nonbank and bank originations are comparable, while the median DTIs for nonbank loans are higher,” the report states.

Kentucky Fannie Mae Mortgage Guideline Changes for 2015


Fannie Mae Kentucky Conforming Guideline Changes

updates

The following guideline changes are effective immediately for all Kentucky Fannie MaeF Conventional loans; however DU will not be updated to reflect these changes until August 15th 2015

Conversion of Currently Primary Residence

Requirements for conversion of a borrower’s current primary residence to secondary or investment have been removed. The converted residence will be treated like a normal second home or investment part with regards to Reserve requirements and use of Rental Income.

This removes all requirements related to the requirement of 30% equity in the converted property.

Stocks, Bonds, & Mutual Funds

  • 100% of the value can now be used. No reduction in value is required.
  • Documentation that the funds have been liquidated is no longer required when the value of the asset is at least 20% greater than the required borrower funds for down payment and closing costs.

Unreimbursed Employee Expenses

If a borrower qualifies using commission income which accounts for less than 25% of borrower’s annual income, base pay, bonus income, or overtime income:

  • Unreimbursed expenses do not have to be analyzed, deducted from qualifying income, or added to monthly liabilities
  • Voluntary deductions (e.g. union dues) do not have to be deducted from income or treated as a liability

If a borrower qualifies using commission income which accounts for 25% or more of their annual income, general unreimbursed business expenses must be deducted from the gross commission income.

If the borrower reports an automobile allowance as part of monthly income, the related expense must always be considered. The underwriter will determine whether automobile expenses will be deducted from income or included in the debt calculation.

Tip Income

In cases where a borrower reports additional “Unreported Tip Income” to the IRS beyond what is reported by their employer, this higher amount of tip income can be used as long as it can be verified with the last 2 years tax returns and filed Forms 4137 (Social Security and Medicare Tax on Unreported Tip Income).

KENTUCKY HOUSING CORPORATION


 Ky Housing is by far the Best Loan program Available for families who live in non Rural Area‘s! 

To Qualify for Kentucky Housing you must make Lower than their Income Limits.  A borrower must also  Credit and Ratio Qualify

We have a great relationship with KY Housing and have the designation of a Main Lender – We Originate, process and close KHC loan products.  We underwrite Ky housing FHA  Loans (KHC performs underwriting for compliance and insuring agency if applicable).

Down Payment Assistance Programs for Mortgage Revenue Bond (MRB) Programs
  • Regular Down payment Assistance Program (DAP)
    • Purchase price up to $237,000.
    • Assistance in the form of a loan that is equal to 4 percent of the purchase price.
    • Available to all KHC first mortgage loan recipients.
    • Repaid over 10 years at the same low rate as the first mortgage loan.
    • KHC’s regular income guidelines.
KENTUCKY HOUSING CORPORATION

 GROSS ANNUAL HOUSEHOLD INCOME LIMITS

 

The income limitations listed below are imposed by federal law.

Failure to comply with them may create adverse consequences for Kentucky Housing Corporation and its bondholders.

Funding Source: New Bond Funds (Purchase Price Limit – $237,000)

 

Person(s) per household

 

(1 or 2)

 

(3 or more)

 

Person(s) per household

 

(1 or 2)

 

(3 or more)

 

Anderson

63,200

72,680

Henry

71,280

83,160

Ballard

51,800

59,570

Jefferson

59,400

68,310

Barren

51,200

58,880

Jessamine

63,500

73,025

Boone

66,200

76,130

Kenton

66,200

76,130

Bourbon

76,200

88,900

Larue

63,240

73,780

Boyd

51,200

58,880

Laurel

51,200

58,880

Boyle

63,480

74,060

Livingston

51,200

58,880

Bracken

79,440

92,680

Lyon

51,200

58,880

Bullitt

59,400

68,310

Marshall

54,000

62,100

Caldwell

51,200

58,880

McCracken

52,900

60,835

Calloway

51,200

58,880

McLean

65,880

76,860

Campbell

66,200

76,130

Meade

51,200

58,880

Carroll

65,880

76,860

Mercer

54,300

62,445

Christian

51,300

58,995

Muhlenberg

51,200

58,880

Clark

76,200

88,900

Nelson

66,960

78,120

Daviess

54,900

63,135

Oldham

59,400

68,310

Edmonson

64,680

75,460

Pendleton

79,440

92,680

Fayette

63,500

73,025

Scott

76,200

88,900

Franklin

63,600

73,140

Shelby

65,500

75,325

Gallatin

79,440

92,680

Simpson

52,700

60,605

Garrard

62,040

72,380

Spencer

71,280

83,160

Grant

63,840

74,480

Taylor

51,200

58,880

Graves

51,200

58,880

Trigg

51,300

58,995

Greenup

51,200

58,880

Trimble

71,280

83,160

Hancock

54,900

63,135

Union

53,100

61,065

Hardin

52,700

60,605

Warren

53,900

61,985

Harrison

63,000

73,500

Webster

71,760

83,720

Henderson

59,800

68,770

Woodford

63,500

73,025

For all other counties not listed above: 61,440 (1 or 2 persons) 71,680 (3 or more persons)

 

Funding Source: New Construction Program for Single Parents, Disabled and Elderly Households

 

Income Limit

$28,000 for households of 1-2 persons or $33,000 for households of 3 or more people

Low 1%-4% Rate.  Borrower Must Credit Qualify.  Program not offered in all Counties.  Money for program is not gauranteed and only offered once a year through a drawing.

 

Purchase Price Limit

$115,000

  • HOME-DAP
    • Purchase price up to $195,700.
    • Assistance up to $4,500
    • No monthly repayment; forgiven over five years.
    • Existing homes only.
    • Borrowers must meet HOME-income guidelines.
  • Please Note $10,000 DAP Runs out fast and a borrower must Credit Qualify
  • HOME Special Program
    • Purchase price up to $195,700.
    • Assistance up to $10,000
    • No monthly repayment; forgiven over five years.
    • Existing homes only.
    • Borrowers must meet HOME-income guidelines.
    • Eligible borrowers include:
      • Households that include a person with a permanent disability and who receives disability income (SSI, SSDI, Veterans Disability etc.).
      • Households where at least one of the home buyers is age 62 or older.
  • HOME Family Program
    • Purchase price up to $195,700.
    • Assistance up to $10,000
    • No monthly repayment; forgiven over five years.
    • Existing homes only.
    • Borrowers must meet HOME-income guidelines.
    • Eligible borrowers include:
      • Single- and two-parent households that have at least one dependent child under the age of 18 living in the household and that are first-time home buyers (have not owned a home or had an ownership interest in a home in the last 3 years).

 GROSS ANNUAL HOUSEHOLD INCOME LIMITS

WHEN HOME PROGRAM FUNDS ARE USED

Effective April 1, 2008

 

Purchase Price Limit When HOME Funds Are Used – $195,700

 

Person(s)

 

(1)

 

(2)

 

(3)

 

(4 or more)

 

Adair, Bath, Bell, Breathitt, Casey, Clay, Clinton, Cumberland, Elliott, Estill, Floyd, Fulton, Green, Harlan, Hart, Jackson, Johnson, Knott, Knox, Laurel, Lawrence, Lee, Leslie, Letcher, Lewis, Lincoln, Magoffin, Martin, McCreary, Menifee, Metcalfe, Monroe, Morgan, Owsley, Perry, Pike, Powell, Pulaski, Rockcastle, Russell, Wayne, Whitley and Wolfe

 

22,950

26,250

29,500

32,800

Bullitt, Henry, Jefferson, Oldham, Spencer and Trimble

 

33,250

38,000

42,750

47,500

Bourbon, Clark, Fayette, Jessamine, Scott and Woodford

 

35,550

40,650

45,700

50,800

Boone, Bracken, Campbell, Gallatin, Kenton and Pendleton

 

37,050

42,350

47,650

52,950

Other Counties

 

Person(s)

 

(1)

 

(2)

 

(3)

 

(4 or more)

 

Person(s)

 

(1)

 

(2)

 

(3)

 

(4 or more)

 

Allen

 

25,100

28,700

32,250

35,850

Larue

 

29,500

33,700

37,950

42,150

Anderson

 

35,400

40,450

45,500

50,550

Livingston

 

27,800

31,750

35,750

39,700

Ballard

 

29,000

33,150

37,300

41,450

Logan

 

27,500

31,450

35,350

39,300

Barren

 

25,650

29,300

33,000

36,650

Lyon

 

27,950

31,900

35,900

39,900

Boyd

 

26,300

30,100

33,850

37,600

Madison

 

32,650

37,300

42,000

46,650

Boyle

 

29,600

33,850

38,050

42,300

Marion

 

25,300

28,900

32,550

36,150

Breckinridge

 

25,950

29,700

33,400

37,100

Marshall

 

30,250

34,550

38,900

43,200

Butler

 

24,550

28,050

31,550

35,050

Mason

 

26,200

29,950

33,700

37,450

Caldwell

 

25,100

28,700

32,250

35,850

McCracken

 

29,600

33,850

38,050

42,300

Calloway

 

27,850

31,800

35,800

39,750

McLean

 

30,750

35,100

39,500

43,900

Carlisle

 

23,350

26,700

30,000

33,350

Meade

 

27,850

31,800

35,800

39,750

Carroll

 

30,750

35,100

39,500

43,900

Mercer

 

30,400

34,750

39,100

43,450

Carter

 

25,000

28,550

32,150

35,700

Montgomery

 

25,850

29,500

33,200

36,900

Christian

 

28,750

32,850

36,950

41,050

Muhlenberg

 

23,400

26,750

30,100

33,450

Crittenden

 

25,150

28,750

32,350

35,900

Nelson

 

31,250

35,700

40,200

44,650

Daviess

 

30,750

35,100

39,500

43,900

Nicholas

 

24,550

28,100

31,600

35,100

Edmonson

 

30,150

34,500

38,800

43,100

Ohio

 

24,750

28,300

31,800

35,350

Fleming

 

23,150

26,450

29,750

33,050

Owen

 

26,900

30,700

34,550

38,400

Franklin

 

35,650

40,700

45,800

50,900

Robertson

 

25,300

28,900

32,550

36,150

Garrard

 

28,950

33,100

37,200

41,350

Rowan

 

24,000

27,400

30,850

34,250

Grant

 

29,800

34,050

38,300

42,550

Shelby

 

36,700

41,900

47,150

52,400

Graves

 

26,150

29,900

33,600

37,350

Simpson

 

29,500

33,700

37,950

42,150

Grayson

 

23,050

26,350

29,650

32,950

Taylor

 

23,400

26,750

30,100

33,450

Greenup

 

26,300

30,100

33,850

37,600

Todd

 

25,650

29,300

33,000

36,650

Hancock

 

30,750

35,100

39,500

43,900

Trigg

 

28,750

32,850

36,950

41,050

Hardin

 

29,500

33,700

37,950

42,150

Union

 

29,750

34,000

38,250

42,500

Harrison

 

29,400

33,600

37,800

42,000

Warren

 

30,150

34,500

38,800

43,100

Henderson

 

33,500

38,300

43,050

47,850

Washington

 

27,950

31,900

35,900

39,900

Hickman

 

26,050

29,750

33,500

37,200

Webster

 

33,500

38,300

43,050

47,850

Hopkins

 

25,750

29,450

33,100

36,800

More about down payment and closing costs:
  • No liquid asset review and no limit on borrower reserves for Regular DAP.
  • Borrowers may retain two months’ house payments in reserve while using available funds first before looking for any form of HOME DAP assistance.
  • Specific credit underwriting standards may apply to down payment programs.
 

 Kentucky Housing History

Kentucky Housing Corporation, created by the 1972 General Assembly, is a self-supporting, public corporation of the Commonwealth of Kentucky administratively attached to the Finance and Administration Cabinet.  A portion of Kentucky Housing’s funds are derived from the interest earned through the sale of tax-exempt mortgage revenue bonds.  From these proceeds, Kentucky Housing has made homeownership possible for over 82,000 Kentucky families.  Kentucky Housing also operates through the receipt of fees for administering federal programs including rental assistance that makes safe, decent, affordable housing available to more than 27,000 low-income Kentuckians.  Other programs additionally offered by Kentucky Housing include rental housing production financing, homeownership education/counseling and a variety of rental assistance, housing rehabilitation and home repair initiatives.

Kentucky Housing Corporation, as the state housing finance agency, is committed to putting people first as we continue to build partnerships and push the boundaries of traditional housing provision and support methods.

FAQ: Should I Refinance? | Equifax Finance Blog


FAQ: Should I Refinance? | Equifax Finance Blog.