Category: Condos Approved for Ky VA loans

Kentucky VA Mortgage Loan information

VA loans in Kentucky, Kentucky VA mortgage, and VA home loans for veterans in Kentucky.


Kentucky VA Mortgage Loan Guide for Home Buyers

You’ve come to the right place if you’re a Kentucky veteran or an active military member. You are searching for VA loan information in Kentucky. VA loans offer unique benefits and flexibility, but many myths and misconceptions surround them. Let’s debunk these myths now. We will give precise information to help you make informed decisions when applying for a Kentucky VA mortgage loan.

Common Myths About Kentucky VA Loans

Myth #1: VA Loans Are Hard to Qualify For

Fact: VA loans have more flexible credit and income requirements than conventional loans. They allow higher debt-to-income (DTI) ratios and lenient credit score thresholds.

  • No Minimum Credit Score: The VA does not set a minimum score, but most lenders require 620. Some go as low as 580, though approvals for lower scores can be more challenging.

Myth #2: VA Loans Need a Down Payment

Fact: VA loans do not require a down payment for loans at or below the local conforming limit.

  1. Jumbo Loans: For higher loan amounts, down payment requirements depend on your VA entitlement:
    • Full Entitlement: No down payment required.
    • Partial Entitlement: Down payment needed to meet the 25% guarantee.

Myth #3: VA Loans Require PMI (Private Mortgage Insurance)

Fact: Unlike conventional loans, VA loans do not require PMI.

  1. This means you save monthly on your house payment which would otherwise be added to your mortgage payment.
  2. Note: Kentucky VA loans do have a funding fee, which can be waived for eligible disabled veterans.

Kentucky VA Loan Refinancing Options

Myth #4: You Can’t Refinance a VA Loan

Fact: VA loans are easier to refinance compared to conventional loans, thanks to programs like:

  1. VA IRRRL (Streamline Refinance): Reduces your interest rate with minimal paperwork. No credit check or appraisal required.
  2. VA Cash-Out Refinance: Allows you to access your home’s equity, subject to an appraisal and credit check.

VA Loan Entitlement & Multiple VA Loans

Myth #5: You Can Only Have One VA Loan

Fact: You can have multiple VA loans as long as you have remaining entitlement.

  • Entitlement Coverage:
    • Loans under $144,000: VA guarantees up to $36,000.
    • Loans over $144,000: VA guarantees up to 25% of the loan amount.
  • Note: If you’ve used a part of your entitlement for another loan, you may need to make a down payment. This applies to extra loans.

Myth #6: You Can Only Use a VA Loan Once

Fact: You can use your VA loan benefits unlimited times throughout your life.

  • To reuse the benefit, you must either:
    • Pay off your current VA loan, or if enough entitlement is left on your COE, and you qualify with both house payments on the dti and residual income test, you may be able to have two va loans active at the same time
    • Sell the property and restore your entitlement.

Assumability and Other Uses of VA Loans

Myth #7: VA Loans Are Not Assumable

Fact: VA loans are assumable, meaning another buyer can take over your VA loan.

  1. Benefits: This is especially valuable in a low-interest-rate environment.
  2. Requirements for Buyers:

Myth #8: You Can’t Buy Land with a VA Loan

Fact: While VA loans don’t cover land purchases alone, they allow you to:

  1. Buy land and immediately build a home on it with a VA construction loan.
  2. Use a conventional loan to buy land, then refinance into a VA loan after building your home.

Myth #9: You Can’t Build a House with a VA Loan

Fact: VA construction loans allow you to build a home, as long as the builder is VA-approved. Upon completion, you can refinance the loan into a permanent VA mortgage.

Myth #10: VA Loans Are Only for Home Purchases

Fact: VA loans can also be used for home improvement projects.

Benefits of Kentucky VA Loans

  1. 100% Financing: No down payment required.
  2. No PMI: Reduces your monthly mortgage payment.
  3. Low Closing Costs: Sellers can pay closing costs and prepaid, up to 4% and even payoff borrower’s debts to qualify for a mortgage loan above the 4% threshold for seller concessions
  4. Flexible Credit Guidelines: Perfect for veterans with past credit issues. No minimum credit score but wight most heavily the last two years on credit report. No foreclosure, Chapter 7 bankruptcies the last two years
  5. Assumability: Allows buyers to take over existing VA loans.

Get Started with Your Kentucky VA Loan Today!

As a mortgage loan officer, I have over 20 years of experience. I’ve helped more than 1,300 Kentucky families buy or refinance their homes. Whether you’re buying your first home, upgrading, or refinancing, I’m here to make the process smooth and stress-free.

Contact Information:
📞 Text/Call: 502-905-3708
📧 Email: kentuckyloan@gmail.com
🌐 Website: www.mylouisvillekentuckymortgage.com

Joel Lobb
Mortgage Loan Officer – Specialist in Kentucky VA, FHA, USDA, and KHC Loans

  • NMLS ID: 57916
  • Address: 10602 Timberwood Circle, Louisville, KY 40223

Let’s make your homeownership dreams a reality! Reach out today to learn more about VA loan options in Kentucky.

“VA loans in Kentucky,” “Kentucky VA mortgage,” and “VA home loans for veterans in Kentucky.”

Comparing Kentucky VA loans to Kentucky USDA, FHA, and Fannie Mae loans in Kentucky

Kentucky VA loans offer flexible credit score requirements and debt-to-income ratios, while USDA loans provide lower interest rates and zero down payment in rural areas. FHA loans cater to first-time homebuyers with low down payments, while Fannie Mae loans offer competitive rates for a wide range of properties. Ultimately, the right choice depends on individual financial circumstances and property location.


Kentucky VA loans Compared to Kentucky USDA, FHA, and Fannie Mae loans in Kentucky

When comparing Kentucky VA loans to Kentucky USDA, FHA, and Fannie Mae loans in Kentucky, several factors come into play, including credit score requirements, income considerations, work history, debt ratios, and how each loan type treats bankruptcy and foreclosure. Let’s delve into the benefits and differences of each loan type:

Kentucky Mortgage Credit Score Requirements:

  • Kentucky VA Loan: VA loans typically have more flexible credit score requirements compared to conventional loans. While there’s no specific minimum score set by VA , most Kentucky VA lenders often look for a credit score of 620 or higher. I can do VA loans down to a 580 credit score.
  • Kentucky USDA Loan: USDA loans also offer flexibility, with no minimum score required per USDA guidelines, but most Kentucky USDA lenders will want a 640 score or higher. I Can do Kentucky USDA loans down to a 580 credit score on a manual underwrite.
  • Kentucky FHA Loan: FHA loans are known for accommodating borrowers with lower credit scores, often accepting scores as low as 500 with a 10% down payment or 580 with a 3.5% down payment.
  • Kentucky Fannie Mae Loan: Fannie Mae loans usually require a minimum credit score of 620 or higher, although some lenders may have slightly different requirements.

Kentucky Mortgage Income and Work History:

  • Kentucky VA Loan: VA loans consider your stable income and employment history but may be more lenient if you have a history of military service or steady employment. 2 years of employment needed for loan application-minimal job gaps
  • Kentucky USDA Loan: USDA loans often have income limits based on the area’s median income, and you need a stable income source. 2 years of employment needed for loan application-minimal job gaps
  • Kentucky FHA Loan: FHA loans consider your income stability and work history, with guidelines that vary by lender. 2 years of employment needed for loan application-minimal job gaps
  • Kentucky Fannie Mae Loan: Fannie Mae loans typically require a stable income and employment history, similar to conventional loans. 2 years of employment needed for loan application-minimal job gaps

Kentucky Mortgage Debt Ratio Requirements:

  • Kentucky VA Loan: VA loans generally have more lenient debt-to-income (DTI) ratio requirements, often allowing for a higher DTI compared to conventional loans. VA loans can get approved on much higher debt to income ratios vs FHA, USDA and Fannie Mae loans. 65% or higher in some situations but if manual underwrite, will want the ratios closer to 41% with good residual income for VA loan. VA loans are the only type of loans that require a residual income…FHA, Fannie Mae, USDA does not have residual income requirements
  • Kentucky USDA Loan: USDA loans have very strict DTI ratio limits, typically around 41% to 45% max on the backend ratio and 33% or less on the front end. By far the most restrictive on debt ratios vs FHA, VA, and Fannie Mae loans
  • Kentucky FHA Loan: FHA loans also have relatively flexible DTI ratio limits (56% back end ratio possible on a AUS approval), making them accessible to borrowers with moderate levels of debt. Front end ratio max 45%
  • Fannie Mae Loan: Fannie Mae loans follow standard DTI ratio guidelines similar to conventional loans. TYpically the second most restrictive on debt ratios right behind USDA loans on tighter debt to income ratio requirements, with the max back-end ratio no more than 50% –Front end ratio max 45%

Kentucky Mortgage Bankruptcy and Foreclosure Requirements:

  • Kentucky VA Loan: VA loans are more forgiving of past bankruptcy or foreclosure, often requiring a waiting period of 2 years for Chapter 7 bankruptcy and 1-2 years for foreclosure.
  • Kentucky USDA Loan: USDA loans have specific waiting periods after bankruptcy (3 years for Chapter 7) and foreclosure (3 years).
  • Kentucky FHA Loan: FHA loans have shorter waiting periods after bankruptcy (2 years for Chapter 7) and foreclosure (3 years).
  • Kentucky Fannie Mae Loan: Fannie Mae loans typically require longer waiting periods after bankruptcy (4-7 years) and foreclosure (7 years).

Advantages and Disadvantages of Kentucky VA loans, USDA, Fannie Mae and FHA:

  • Kentucky VA Loan Advantages: Zero down payment, competitive interest rates, no private mortgage insurance (PMI) requirement, lenient credit and DTI ratios, and flexible eligibility criteria for veterans and active-duty service members.
  • Kentucky VA Loan Disadvantages: Funding fee (although it can be rolled into the loan), limited to eligible veterans, service members, and some spouses.
  • Kentucky USDA Loan Advantages: Zero down payment, lower interest rates, flexible credit requirements, and available in eligible rural areas.
  • Kentucky USDA Loan Disadvantages: Limited to rural properties, income limits, and property eligibility criteria.
  • Kentucky FHA Loan Advantages: Low down payment (3.5%), flexible credit requirements, competitive interest rates, and accessible to first-time homebuyers.
  • Kentucky FHA Loan Disadvantages: Mortgage insurance premiums (MIP), stricter property standards, and limits on loan amounts.
  • Kentucky Fannie Mae Loan Advantages: Available for a wide range of properties, competitive interest rates, and options for low down payments.
  • Kentucky Fannie Mae Loan Disadvantages: Stricter credit and DTI requirements, potential for private mortgage insurance (PMI), and limited flexibility for borrowers with past financial challenges.

In summary, choosing the right loan type depends on your specific financial situation, eligibility criteria, and property location. VA loans offer excellent benefits for eligible veterans and service members, while USDA, FHA, and Fannie Mae loans provide alternatives with their own advantages and considerations.

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).

Kentucky VA Mortgage Qualifications


 

Kentucky VA Loan Benefits

Kentucky VA Mortgage does not have a minimum credit score requirement. When a lender requires a minimum credit score it is generally a 580-620, that is called a lender overlay. An overlay is a lender’s own underwriting guidelines above and beyond the VA guidelines.

The most common reason for a Veteran’s loan to be declined is not having a required minimum credit score per the lenders own set of guidelines above and beyond what the VA requires.

As announced by the VA in Circular 26-19-30 (which provides interim guidance on implementing “The Blue Water Navy Vietnam Veterans Act of 2019″) the conforming loan limit cap on guarantees was removed for Veterans with full entitlement. For Veterans who have previously used entitlement and the entitlement has not been restored, the maximum amount of guaranty entitlement available to the Veteran (for a loan above $144,000) is 25 percent of the conforming loan limit reduced by the amount of entitlement previously used (not restored) by the Veteran. The new guaranty requirements apply for loans closed on or after January 1, 2020.

In 1944, the Servicemen’s Readjustment Act was established in to provide veterans and their surviving spouses with a number of benefits. Among these benefits was the VA loan program. VA loans allow veterans and military to purchase homes with 100% financing, no mortgage insurance, and limited closing costs.

In order to apply for a VA loan, you need to meet eligibility requirements. Most veterans, military, and spouses of deceased military members will be eligible. Veterans can apply without any delay if minimum active duty service requirements have been met. Active duty service members on the other hand will need to complete a minimum of 6 months of service first. National Guard and reservists will need to wait 6 years before the benefit kicks in. If they are called to active duty at any point, they will become eligible after only 181 days.

Anyone who intends to apply for a VA loan will need to obtain their Certificate of Eligibility. It is important to note that the COE only proves to your lender that you have met the minimum service requirements. It is not a guarantee that you will be approved for a loan. One of the easiest ways to get your COE is through the VA’s eBenefits Portal. Whether you are looking to purchase your very first home or are looking to take advantage of the VA loan program to refinance, we can help you find a loan that meets your exact needs.

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