Kentucky VA Mortgage Guidelines For Approval

Kentucky Mortgage VA Underwriting

Major changes are as follows, but the documents have been revised throughout so it is recommended that everyone review them

Borrowers using rental income from a non-subject property to qualify need to document a minimum 2 year rental history and 3 months reserves PITI for each rental property (excluding property being vacated and turned into a rental). When no mortgage exists on a rental property, 3 months reserves must still be provided that cover taxes, insurance, HOA dues, and any other fees documented for the property. These reserves cannot come from equity, gift funds, or any loan proceeds.

• Rental income from boarders can now be used as qualifying income provided
  • A 2 year history of tax returns can be provided showing boarder income generated by the property; AND
  • The use of the property for boarder rental cannot impair the residential nature of the property and cannot exceed 25% of the property's total floor area
• Alimony, child support, and maintenance require at least 3 years continuance to be considered effective income.
• For payment plans after a judgment, VA will generally require 12 months of timely payments before credit is considered reestablished. A shorter repayment history may be considered if it can be determined that the borrower addressed the judgment responsibly and began a repayment plan immediately after it was filed. If borrower has missed payments within the last 12 months, they will be ineligible for financing even if the debt is paid in full.
• For voluntary short sales or deeds-in-lieu where the borrower was current on their payments at the time the property was surrendered, no minimum derogatory credit waiting period will be required.
• VA's list of required Appraisal Report Contents has been updated and now includes specific photographs required on the appraisal (refer to VA Chapter 11: Topic 3: Appraisal Report Contents for full list).
• VA Chapter 11: Topic 4: Gross Living Area has been added to provide direction in determining the Gross Living Area of the property.
• Other sections have been updated to include guideline changes from previous VA Circulars.

KENTUCKY VA MORTGAGE QUALIFYING GUIDELINES

 

Joel Lobb
Mortgage Loan Officer

Individual NMLS ID #57916

American Mortgage Solutions, Inc.

10602 Timberwood Circle 

Louisville, KY 40223

Company NMLS ID #1364

click here for directions to our office

Text/call:      502-905-3708

fax:            502-327-9119
email:          kentuckyloan@gmail.com

https://www.mylouisvillekentuckymortgage.com/

 

Louisville Kentucky Mortgage Lender VA, can you have 2 Kentucky VA Loans?

Louisville Kentucky Mortgage Lender for FHA, VA, KHC, USDA and Rural Housing Kentucky Mortgage: Can you have 2 Kentucky VA Loans?: Did You Know  A Kentucky Veteran Can Have Multiple VA Loans: That’s right. VA will allow a Kentucky Veteran to have multiple Kentucky ...

Kentucky VA Mortgage Refinance

Kentucky VA Mortgage Refinance Guidelines

100% of the home's value No Income or Asset verification is required for a VA Refinance No Appraisal is required  No Credit Qualifying VA Funding Fee is .50% Can refinance an investment property as long as you can document it was formerly the borrower’s primary residence At least 6 monthly payments must have been made on the original loan being refinanced; AND The first payment due date of the new loan must be at least 210 days after the first payment due date of the original loan being refinanced A copy of the Note from the previous loan being refinanced must be provided An IRRRL refinancing a Fixed Rate Mortgage into another Fixed Rate Mortgage must result in a rate IRRL is also know as Interest Rate Reduction Loan in VA terms. reduction of at least 0.5% An IRRRL refinancing a Fixed Rate Mortgage into an Adjustable Rate Mortgage must result in a rate  reduction of at least 2.0% IRRRLs in which a Discount is being charged to the borrower will now require an Exterior-Only Appraisal to be ordered If the Discount being charged is 1% or less, the loan will be limited to 100% LTV based on the value of the Exterior-Only Appraisal If the Discount being charged is more than 1%, the loan will be limited to 90% LTV based on the value of the Exterior-Only Appraisal Loan must current be guaranteed by VA and must be current Closing costs must be recouped within 36 months Proposed P&I payment must be less than current payment unless: Veteran refinancing ARM to Fixed Term of IRRRL is shorter than existing loan as long as payment does not increase over 20% Energy efficiency improvements are included in the IRRRL VA Guaranteed by the Veterans Administration for qualified military veterans. No down payment if the property appraises for the sale price or greater. Credit underwriting is flexible. No Minimum credit score for VA loans, but lenders will create overlays to protect their selling ability to VA for delinquent mortgage loans sold to VA. A lot of VA lenders want a 620 credit score, with some going down to 580, and a few will do down below that but very difficult to get approved with a VA lender. No monthly mortgage insurance payments are required, however they're upfront funding fees that range anywhere from 2.1% to 3.3% based on previous use or first time use of VA eligibility to buy a home, or if you are disabled, you may have not to pay this at all. The VA Certificate of Eligibility will show if you have to pay a funding fee to VA or if you are exempt.

Kentucky VA Mortgage Guidelines for Student Loan Payments

Clarification and New Policy for Student Loan Debts and Obligations

 1. Purpose. The purpose of this Circular is to clarify and explain new policy regarding
student loans for the underwriting of Department of Veterans Affairs (VA) guaranteed home
loans.

 2. Background. The policy in the Lender’s Handbook- VA Pamphlet 26-7, chapter 4, section 5,
paragraph G will now be titled Student Loans. The clarification will apply to deferred student
loans and the new policy will provide guidance for student loans in repayment or, to begin
repayment within 12 months of a VA loan closing. Student loans under certain repayment plan
types are described at studentaid.ed.gov. This policy applies to all student loan repayment types.

 3. How to Calculate a Student Loan Monthly Payment.

 a. If the Veteran or other borrower provides written evidence that the student loan debt will be
deferred at least 12 months beyond the date of closing, a monthly payment does not need to be
considered.
 b. If a student loan is in repayment or scheduled to begin within 12 months from the date of
VA loan closing, the lender must consider the anticipated monthly obligation in the loan
analysis and utilize the payment established in paragraph (1) or (2) below. Calculate each loan
at a rate of 5 percent of the outstanding balance divided by 12 months (example: $25,000
student loan balance x 5% = $1,250 divided by 12 months = $104.17 per month is the monthly
payment for debt ratio purposes).

 (1) The lender must use the payment(s) reported on the credit report for each student loan(s) if
the reported payment is greater than the threshold payment calculation above.
 (2) If the payment reported on the credit report is less than the threshold payment calculation
above, the loan file must contain a statement from the student loan servicer that reflects the
actual loan terms and payment information for each student loan(s). The statement(s) must be
dated within 60 days of VA loan closing and maybe an electronic copy from the student loan
servicer’s website or a printed statement provided by the student loan servicer. It is the
lender’s discretion as to whether the credit report should be supplemented with this information

Joel Lobb (NMLS#57916)
Senior  Loan Officer

American Mortgage Solutions, Inc.

10602 Timberwood Circle Suite 3

Louisville, KY 40223

Company ID #1364 | MB73346

Text/call 502-905-3708
 kentuckyloan@gmail.com

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 http://www.nmlsconsumeraccess.org/

-- 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.

VA Student Loans for Kentucky Mortgage Loan Approval

 Kentucky VA Student Loans

Did you know that VA has a new policy for calculating student loan payments?

Considering the Payment:

• If the student loan repayments are to begin within 12 months of closing, the debt will be considered.
  

• If the student loan payment is being deferred for a period longer than 12 months after closing, the debt does not need to be considered.

Calculating the Payment:

• Calculate each loan at a rate of 5% of the outstanding balance then divide that by 12 months.

            Example: $25,000 x 5% = $1,250 divided by 12 months is $104.17 per month.

• If the student loan payment reported on the Borrower’s credit report is greater than the calculated payment, then the credit report payment will be used.
  

• If the payment reported on the credit report is less than the calculated amount, the lender must require a statement (dated within 60 days of closing)  from the student loan servicer that reflects the actual terms and payment information for each student loan.
  

• If the student loan payment is in an Income Based Repayment Plan and the current payment is documented to continue for at least 12 months after closing, the lender may use the IBR amount. If the payment is not expected to continue for at least 12 months after closing, a monthly statement is required. If a statement is not available, the calculation of 5% of the balance, divided by 12 will be used.
  

Documentation for payments and 12 months continuance will be required

For more Information see VA Circular 26.17.02 dated 1/23/17

What are the eligibility requirements for a VA Loan in Kentucky?

What are VA Home Loans?

VA Loans provide military veterans and current service members a distinct advantage when it comes time to purchase or refinance a home. Today’s VA Loans have the most favorable terms available for most veterans. VA Loans can be used to purchase a new home with no down payment with no mortgage insurance or refinance up to 90% of a homes current equity.

What are the eligibility requirements for a VA Loan in Kentucky?

Veterans Affairs loan guidelines use two methods of income qualification in Kentucky. The residual income method is the primary method, where it is determined that the borrower has sufficient income to cover daily living costs once housing, taxes, insurance and all other liabilities like credit card and auto payments have been made. Additionally, VA loans use a debt to income ratio (DTI). Using this ratio, the veteran’s total debt should not exceed 41% of the veteran’s total income. Most lenders will require at least a 620 credit score for a VA Loan approval. VA does not have a minimum credit score requirement, but lenders do.

How much can I borrow?

The maximum VA Mortgage amount is determined by:

Maximum Finance: For purchase transactions, the Maximum VA Loan will be 100% of the lower of the selling price or the appraised value

What property types are allowed for VA Loans in Kentucky

VA Loans may be used to purchase or refinance single family residences and VA approved condo projects if the property is the veteran’s primary residence.

Can I do a VA refinance in Kentucky?

Three kinds of VA Refinance programs are available for veterans in Kentucky.

Rate/Term VA Refinance

The Rate/Term VA Refinance can be used to refinance a conventional, FHA or subprime mortgage into a stable, fixed rate VA Loan.

VA Cash-Out Refinance

A Cash-Out VA Refinance is very beneficial for the veteran who wants to access the equity that they have built up in their home. VA Loans can be used to refinance up to 90% of a homes current value and take cash out for any reason.

Streamline Refinance

The VA Streamline Refinance is designed to lower the interest rate on a current VA mortgage or convert a current VA adjustable rate mortgage into a fixed rate. A VA Streamline Refinance Loan can be performed quickly and easily. It requires much less hassle and paperwork than a normal refinance including no appraisal, no qualifying debt ratios and no income verification.

What factors determine if I am eligible for a VA Refinance Loan?

VA refinance loans use two methods for income qualification purposes in Kentucky. The residual income method is the primary method, where it is determined that the borrower has sufficient income to cover daily living costs once housing, taxes, insurance and all other liabilities like credit card and auto payments have been made. Additionally, VA loans use a debt to income ratio (DTI). Using this ratio, the veteran’s total debt should not exceed 41% of the veteran’s total income. Most lenders will require at least a 620 credit score for a VA Loan approval even though VA states in their guidelines it has no minimum credit score. 

Why choose a VA Home Loan?

Kentucky VA Mortgages require no down payment.

There are no prepayment penalties for VA Home Loans.

An Kentucky VA Loan is fully assumable, provided the person assuming is qualified.

VA Mortgage Loans have no PMI premiums.

A VA Mortgage Loan is eligible for non-credit qualifying, Streamline Refinance or “IRRRL”.

A VA Home Mortgage is available all areas of the country, provided a market exists for the property and the home meets VA’s property standards.

A VA Home Loan may be used to purchase or refinance a new or existing home.

Kentucky VA Loans are offered at terms of 15 or 30 years.