Category: VA Funding Fee

Kentucky VA Mortgage Funding Fees Reduced for 2023

Kentucky VA Announces Reduced Funding Fees


Kentucky VA Announces Reduced Funding Fees
Effective with loans closing on and after 04/07/2023, VA has announced new lower loan fee rates for Purchase and Cash Out Refinance loans. There is no change to the funding fees for other Kentucky VA Home Loan Types. 

  • VA Purchase / Construction Loans
    • First Use
      • Down Payment Amount:
        • Less than 5%: Funding Fee 2.15%
        • 5% or more down payment: 1.5%
        • 10% or more down payment: 1.25%
    • Subsequent Use
      • Down Payment Amount:
        • Less than 5%: 3.3%
        • 5% or more down payment: 1.5%
        • 10% or more down payment: 1.25%
  • VA Cash-Out Refinance
    • First Use: 2.15%
    • Subsequent Use: 3.3%
  • Other VA Home Loan Types
    • Interest Rate Reduction Refinance Loan (IRRRLs): 0.5%
    • Loan Assumptions: 0.5%

Please note the following:

  • For standard purchase loans, the reduced funding fee is based on the sales price. 
  • For construction purchase loans, equity in the secured property may be used as a down payment for calculating the reduced funding fee.

Kentucky VA Mortgage Sales Concessions – How Well Do You Understand This Guideline?

Kentucky VA Mortgage Sales Concessions – How Well Do You Understand This Guideline?


Kentucky VA Sales Concessions – How Well Do You Understand This Guideline?

Knowing these tips can help you save a loan!

VA limits Sales Concessions to 4%, but there is more to it than that!

What is a Sales Concession that is applied to the 4% limit?

• Buyer’s funding fee

• Prepaid taxes and insurance

• Gifts such as a television or microwave

• Permanent interest rate buy-down points

• Temporary buy-down funds

• Payoff of Credit Balances or Judgments [Yes, you read that correctly]!

HOWEVER……….

Not included in this limit are the following:

•Amounts paid on behalf of the Veteran by the lender or real estate agent.

•Or amounts paid by the seller towards the closing costs.

These amounts can be paid in addition to the Seller Concessions.

Example:

$200,000 loan amount x 4% = $8000 maximum seller concession.

The seller pays $4000 in closing costs [NOT included as part of the seller concession].

The lender pays $1500 in prepaid items [NOT included as part of the seller concession].

The Seller pays off a judgment for the borrower of $5500 [YES, this IS included as part of the seller concession].

The Agent pays $400 for the home inspection [NOT included as part of the seller concession].

So, the Veteran received $11,400 from a combination of the seller, lender, and Agent.

The seller contributed $9500, but only $5500 is considered part of the 4% seller concession limit. The other $4000 is closing costs, which are not included in the seller concession limit.

Therefore, the total seller concession was $5500, which is less than the maximum seller concession of $8000.

The key to VA sales concessions is understanding what IS and IS NOT included in the sales concession limit. Mastering this guideline will help you save a lot of loans!

List of Government Foreclosed Homes in Kentucky to include VA, FHA, HUD, Fannie Mae and USDA


 
 

Several federal agencies have properties to sell. In fact, HUD sells both single family homes and multifamily properties. Check them out- one might be just what you’re looking for!

Single Family Homes for Sale