Tag: Loan-to-value ratio

>KENTUCKY USDA, RURAL DEVELOPMENT GUIDELINES 2011


>QUICK GUIDE

USDA, RURAL DEVELOPMENT

GUARANTEED RURAL HOUSING LOAN

Advantages:

No Down Payment Required

30 year fixed rate

100% LTV plus the guarantee fee, if financed

Finance Closing Costs, if market value is sufficient

Expanded Ratios of 29/41%

No Mortgage Insurance

No cash contribution required from borrower

Unrestricted gifts

No Maximum Loan Amount – loan amount based on repayment ability of applicant

No Reserve Requirement

High earnings potential

Competitive rates (set by underwriting lenders)

Available secondary markets: wholesale lenders as well as Fannie Mae and Freddie Mac.

Utilize in Conjunction with State Housing Authorities, if available

Rural Development designated rural area:

Homes must be located in rural areas. Rural areas include open country and places with a population of 10,000 or less and-under certain conditions-towns and cities with between 10,000 and 25,000 residents. See the rural area eligibility site at http://eligibility.sc.egov.usda.gov, click on “property eligibility”. If you need additional assistance, please contact your local Rural Development office.

Acceptable credit history:

Have a credit history that indicates a reasonable willingness to meet obligations as they become due

Lender underwrites the loan

No minimum credit scores

Lack of credit is not derogatory

Caution for applicant(s) with multiple layers of risk such as:

payment shock; low credit scores; ratio waiver; credit waivers; 2-1 buy downs

Check maximum income for eligibility:

Applicant(s) have an adjusted household income that does not exceed the moderate income limit established for the area. A family’s income includes the total gross income of the applicant, co-applicant and any other adults in the household. Applicants may be eligible to make certain adjustments to gross income-such as annual child care expenses and $480 for each minor child-in order to qualify. USDA Rural Development field offices can provide information on the moderate income limits for the areas that fall within their jurisdictions, and can provide further guidance on calculating household income. There is an automated eligibility calculator at: http://eligibility.sc.egov.usda.gov

KENTUCKY USDA, RURAL DEVELOPMENT GUIDELINES Kentucky USDA Rural Housing Mortgage Loans

Applicant(s) repayment ability:

The ratio limits are 29 front (housing, PITI), 41 back (total debt, MOTI). Rural Development allows expanded repayment ratios if the applicants have sufficient compensating factors. The underwriter must recommend the expanded ratio(s) and provide compensating factors to Rural Development. Rural Development must concur with the underwriter’s recommendation in order to expand the ratios.

Other eligibility criteria:

Do not own a dwelling

Insufficient resources to secure conventional financing without the guarantee

U.S. citizen or permanent resident or qualified alien

Legal capacity

Primary residence

Loan-To-Value (LTV) and Loan Limit:

100% LTV plus the amount of the guarantee fee, if financed

Loan amount can exceed appraised value by the amount of the guarantee fee

There is no loan limit

-Limiting factors will be ratios and income limit

Property requirements:

New or proposed home construction – stick built, modular, townhouses, condominiums, new manufactured homes.

Existing homes: Meet requirements of HUD Handbooks 4905.1 and 4150.2

New and existing: Private well water quality must meet local and state code.

FHA appraisers in the area can be found on the FHA web site: https://entp.hud.gov/idapp/html/apprlook.cfm

Existing (previously occupied) manufactured home financed under limited circumstances when home presently financed by USDA.

New manufactured homes: Rural Development will finance new manufactured homes through approved dealer-contractors. Contact your local Rural Development office for a list of approved dealer-contractors and the specifics of how new manufactured homes can be financed.

Modular homes: New or existing modular homes can be financed the same as stick built homes.

Condo: Rural Development can finance if it meets the standards for Fannie Mae, Freddie Mac, VA, or FHA.

Town home: Same as condo. A town home must have provisions for maintenance such as HOA.

Flood Zone:

Any existing improvements located in a special flood hazard area must have federal flood insurance coverage. New construction is not permitted until a Letter of Map Revision/Amendment is issued by FEMA.

One time guarantee fee based on the final loan amount

This fee can be financed along with other closing costs. The first mortgage guaranteed loan cannot exceed appraised value by more than the amount of the fee financed. No mortgage insurance requirement.

Term: 30 year fixed

Interest Rate:

Fannie Mae 90 day delivery plus 60 basis points rounded to the nearest quarter percent or

The lenders published VA rate with no discount points


Apply today for your USDA Rural Housing Loan in Kentucky for free. No application Fees and same day loan approval.
502-905-3708

Prohibited Loan Purposes:

In-ground swimming pools – unless value is deducted from the loan request

Existing manufactured homes

Construction draws

Furniture and personal property

Income producing property

Non-essential buildings and land

Joel Lobb (NMLS#57916)
Senior  Loan Officer
502-905-3708 cell
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KHC’s First Mortgage Government Loan Products


KHC’s First Mortgage Government Loan Products

Federal Housing Administration (FHA)

Minimum 640 credit score required.

Financing to 96.50% of lesser of sales price or appraised value.

All KHC DAPs and other KHC-approved secondary financing may be used.

Maximum 6% seller-paid items.

Maximum ratios of 40/45 with AUS approval.

28 for HUD’s full policy.

All borrowers must be scored by TOTAL and receive approve/eligible or accept/accept.

Lender must follow the FHA maximum mortgage limits for particular area

see https://entp.hud.gov/idapp/html/hicostlook.cf

just follow Upfront and Annual Mortgage Insurance Premiums Guidelines (see information below).

Upfront and Annual Mortgage Insurance Premiums

Loan Terms Greater than 15 Years

Case numbers on or after Monday, April 18, 2011

LTV less than or equal to 95%

1% annual 1.10 monthly

LTV greater than 95%

1% annual 1.15 monthly

Conventional

Minimum 660 credit score required

Maximum loan-to-value (LTV) ratio is 80%.

Maximum ratios 40/45 with AUS approval.

No down payment assistance products may be used. Borrower must meet down payment requirements with their own funds or a gift.

Federal Home Loan Bank monies allowed once borrower meets the 20% down payment requirement. Must be entered as subordinate

financing in DU/LP.

Pre-purchase education required as per AUS findings.

Not available for manufactured housing.

Appraiser Independence required (see page 4).

KHC does not presently have a product for 81% LTV or greater.

Rural Housing Services (RHS)

Minimum 640 credit score required.

Financing to 100% of the appraised value, plus guarantee fee of 3.5%.

All KHC DAP programs and other KHC-approved secondary financing may be used.

No maximum on seller-paid items.

Ratio requirements and guarantee fee per agency guidelines.

KHC will accept Government Underwriting System (GUS) findings, including reduced documentation and, with approval, expanded

ratios up to 40/45.

Veteran’s Administration (VA)

Minimum 640 credit score required.

Ratios up to 40/45% with AUS Approval.

Financing to 100% of the lesser of the appraised value or sale price.

All KHC DAP programs and other KHC-approved secondary financing may be used.

Maximum 4% seller-paid items.

Follow agency guidelines for ratio requirements and funding fee.