Category: Streamline Refinance IRRRL

Refinance Guidelines and Information for Kentucky VA Mortgage Loans.

va pic for blogh

 

 

Kentucky VA Mortgage Refinance Guidelines

  • Borrow up to 100% of the home’s value. Unlike other programs that only allow 80% or 85% of the home’s value.
  • No Income or Asset verification is required. We don’t need your paystubs, w-2’s tax info, or bank statements. Much easier qualifying.
  • No Appraisal is required (unless Discount is being charged to borrower – see below)—-VA does not require a new appraisal. So even if your home has not equity or went down in value, we can go off on old value when doing a rate and term with no cash back.
  • No Credit Qualifying. Meaning we don’t have to repull credit again and check your fico scores. Just verify your last 12 months mortgage history is on time.
  • VA Funding Fee is .50%, much less than the 2 or 3% you pay when you buy the home, If disabled, you will not have to pay the funding fee.
  • 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 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
  1. 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
  2. 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:
  1. Veteran refinancing ARM to Fixed
  2. Term of IRRL is shorter than existing loan as long as payment does not increase over 20%
  3. Energy efficiency improvements are included in the IRRL

 

Refinancing a Kentucky VA Loan

Kentucky VA loans may be used to replace an existing mortgage, called “refinancing.” A KY VA refinance may be used to reduce an existing interest rate, change loan terms or a combination of both. The most common reason to refinance is to lower the monthly payment. A borrower may take out a KY VA loan then later see that interest rates have fallen and are lower than an existing rate. By refinancing, the borrower can replace the old loan with a new one to obtain the lower rate and subsequent lower mortgage payment.

A refinance can also make sense when changing loan terms such as switching from an adjustable rate mortgage to a fixed rate or adjusting the term of the loan to save on interest charges.
The Streamline

The Interest Rate Reduction Refinance Loan, or IRRRL is commonly referred to as the Kentucky Mortgage Refinance VA “streamline” refinance program. This is a special VA loan to VA loan refinance that requires very little documentation to obtain an approval. Some of the features of the VA streamline are:

• No appraisal needed

• Income or employment is not verified

• No credit review

• Closing costs may be rolled into the loan amount

As long as you’re reducing your current mortgage payment, not taking any cash out or switching from an adjustable rate mortgage to a fixed rate loan, you may qualify for this unique program and you don’t have to use your existing Kentucky VA lender in order to benefit from the Kentucky VA streamline mortgage.
Cash Out VA loan Refinance

Cash out refinance loans allow the borrower to pull out equity in the home in the form of cash during the course of a refinance. While the VA doesn’t establish a maximum loan amount, most VA lenders do place limits on the loan based upon the current value of the property and the final loan amount. Lenders may limit any cash out loan to 80 or 90 percent of the property’s current value. If taking cash out of your home is needed and you have sufficient equity in your home, it may be better to obtain a home equity loan or refinance into a conventional mortgage.





http://www.emailmeform.com/builder/form/0bfJs9b6bK8TGoc6mQk9hIu
 
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

http://www.nmlsconsumeraccess.org/
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.

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KENTUCKY VA REFINANCE LOAN
QUESTIONS ABOUT A KENTUCKY VA MORTGAGE REFINANCE. CALL OR TEXT ME TODAY. I HAVE DONE OVER 200 VA LOANS IN MY CAREER AND A FORMER ARMY TANKER THAT HAS USED A VA LOAN FOR MY OWN FAMILY.

Kentucky VA Mortgage Changes for Student Loans Guidelines 2017


 
Kentucky VA Mortgage Student Loan Policy  Guideline Changes
VA loans in Kentucky has issued Circular 26-17-02 regarding student loans.  This policy will be effective immediately for all Kentucky VA loans.
How to Calculate a Student Loan Monthly Payment:
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.
If a student loan is in repayment or scheduled to begin within 12 months from the date of closing, the lender must consider the anticipated monthly obligation in the loan analysis and utilize the payment established in one of the options below.  Calculate each loan at a rate of 5%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).
  • The lender must use the payment reported on the credit report for each student loan if the reported payment is greater than the threshold payment calculation above, OR
  • 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.  The statement must be dated within 60 days of the loan closing and may be 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.
1. What are the most popular mortgages you offer?
Why are they so popular?
2. Which type of mortgage plan do you think would
be best for me? Why?
3. Will I have to buy private mortgage insurance?
If so, how much will it cost, and how long will it
be required. (NOTE: Private mortgage insurance
is usually required if your down payment is less than
20%. However, most lenders will let you discontinue
PMI when you’ve acquired a certain amount of equity
by paying down the loan.)
4. Are your rates, terms, and closing costs negotiable?
5. Who will service the loan – your bank or another?
6. What escrow requirements do you have?
7. How long will this loan be in a lock-in period
(in other words, the time that the quoted interest
rate will be honored)? Will I be able to obtain a
lower rate if it drops during this time period?
8. How long will the loan approval process take?
9. How long will it take to close the loan?
10. Are there any charges or penalties
for prepaying the loan?
KHC Hardest Hit Funds Just announced for Louisville Kentucky 2017!
This specific program is for new loan reservation on or after January 11, 2017. KY Housing has $4 Million Dollars set aside for this program and is utilized on a first-come, first-served basis.
  • The funds are for eligible first time home buyers or for those who have not owned a home in the previous 3 years
  • The program is a 2nd mortgage down payment assistance loan up to $10,000, 0% interest rate, forgivable second mortgage loan with a five-year term
  • There is no monthly payment on the down payment assistance loan and 1/5th of the loan is forgiven for 5 years and at that point the loan is fully forgiven
  • The property must remain as your primary residence for those 5 years
  • The down payment assistance loan can be used to cover your closing costs and down payment
  • Max purchase price $283,900
  • Max income for person or persons on the loan in Jefferson County is $117,250
  • The down payment assistance loan must be used in conjunction with KY Housing first mortgage program (conventional or FHA)
  • Minimum 640 credit score to be eligible but we can generally provide advice how to improve your score to that level if needed
  • The property (new or existing) must be located in one of these four counties:
    • Jefferson
    • Christian
    • Hardin
    • Kenton
    • Other counties are not eligible for this specific program but there is a down payment assistance loan for other counties
Joel Lobb
Senior  Loan Officer
(NMLS#57916)
text or call my phone: (502) 905-3708
email me at kentuckyloan@gmail.com
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). Mortgage loans only offered in Kentucky.
All loans and lines are subject to credit approval, verification, and collateral evaluation and are originated by lender. Products and interest rates are subject to change without notice. Manufactured and mobile homes are not eligible as collateral.
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Equal Housing Lender
NMLS No. 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.

2020 Kentucky VA LOAN LIMITS


The changes are part of the Blue Water Navy Vietnam Veterans Act of 2019, which became effective Jan. 1, 2020.  Besides extending disability benefits to more Vietnam War veterans exposed to Agent Orange, the new law eliminates VA loan limits for borrowers with full entitlement to VA loans. It also increases the VA funding fee for most borrowers. (The fee decreases slightly for National Guard and Reserve members.)

VA home loans are a benefit for current and veteran service members. They have competitive interest rates and usually no down payment requirement, among other advantages. VA loan limits are the maximum loan amount the Department of Veterans Affairs can guarantee without borrowers making a down payment. VA funding fees are one-time fees borrowers pay in lieu of mortgage insurance to help cover the government’s costs for backing the loans. If a borrower defaults, the VA repays the lender a portion of the loan.

No VA home loan limits in 2020

“Removing the loan limits is huge for veteran and military buyers across the country, and it comes on the heels of another big year in VA lending,” says Chris Birk, director of education at Veterans United Home Loans. The VA guaranteed 624,544 loans in fiscal year 2019, a 2% increase over the prior fiscal year, according to data from the Department of Veterans Affairs.

“Veterans living or stationed in costlier real estate markets can stretch the zero-down buying power of their benefit in a way they never have before,” Birk says.

The removal of loan limits doesn’t mean unlimited borrowing power without a down payment. You’ll still need to have sufficient income and meet a lender’s credit requirements to qualify for the loan amount.

Loan limits will still apply in 2020 to veterans who have one or more active VA loans or have defaulted on a previous loan, Birk says.

Those VA loan limits are the same as the ones set by the Federal Housing Finance Agency on conforming loans. The limit in 2020 is $510,400 in a typical U.S. county and higher in expensive housing markets, such as San Francisco County.

If you’re subject to VA loan limits, the lender will require a down payment if the purchase price is above the loan limit. The exact down payment you will pay is determined by a formula that takes into account your entitlement and home price.

VA funding fee to increase

The VA funding fee you pay in 2020 will depend on your down payment amount and whether you’ve ever had a VA-backed loan before. If you haven’t, it’s a “first use” loan, and if you have, it’s a “subsequent use” loan. You can pay the fee upfront or roll the cost into the loan.

The fee for first-use, zero-down loans is 2.3% of the loan amount in 2020, up from 2.15% for active-duty military and veterans in 2019. The fee for subsequent use loans will be 3.6% of the loan amount, up from 3.3%. These fees will stay in place for two years, return to 2019 levels from 2022 through Sept. 30, 2029, and then drop further after that.

The funding fee increase is lower and lasts for a shorter period than earlier proposals, Birk says. “It’s critical that the VA loan remains affordable.”

Other VA funding fee changes

The Blue Water Navy Vietnam Veterans Act of 2019 made a couple of other funding-fee changes. Starting in 2020, the fees will be the same for the main branches, National Guard and reservists. Currently, National Guard and Reserve members pay slightly higher fees.

In addition, active-duty service members who have received a Purple Heart are now exempt from the funding fee.

Shopping for a VA loan

Not all lenders offer VA loans, and among those that do, some have more experience working with military service members and veterans than others.

“There is a huge variation, depending on which lender you go with,” says Anthony Powell, chief operating officer for AAFMAA Mortgage Services LLC in Fayetteville, North Carolina. “Going to the first bank you think of may not be the best option.”

Requirements for borrowers and mortgage rates vary among lenders. For example, the U.S. Department of Veterans Affairs does not require a minimum credit score for VA loans, but lenders can set their own thresholds.

Aim to get quotes from at least three lenders, and look for one that provides the information and help you need to understand and move as smoothly as possible through the mortgage process.