Kentucky VA Home Mortgage Loan
A Kentucky VA home mortgage loan can be a straightforward process with significant benefits, including no down payment and competitive interest rates.
Here’s a comprehensive guide to getting approved for a Kentucky VA home mortgage loan in Kentucky, covering all crucial aspects such as credit score, debt ratio, work history, bankruptcy, foreclosure, income limits, funding fees, loan limits, appraisal, termite inspection, title report, and closing the loan.
Credit Score needed for Kentucky VA loan
While the VA does not set a minimum credit score requirement for Kentucky VA Mortgage loan approvals, lenders typically look for a credit score of at least 620. However, some lenders may accept lower scores based on other favorable factors such as a solid work history or low debt-to-income ratio.
Debt-to-Income Ratio needed for Kentucky VA loan
The VA prefers a debt-to-income (DTI) ratio of 41% or less. This means your monthly debt payments, including the new mortgage, should not exceed 41% of your gross monthly income. Exceptions can be made for borrowers with strong residual incomes or other compensating factors. Residual Income table here ->
Work History needed for Kentucky VA loan
A stable 2 year work history is crucial. Lenders usually require at least two years of continuous employment. Consistent income from a reliable source reassures lenders of your ability to make mortgage payments.
Bankruptcy Requirements for Kentucky VA loan
For veterans with a history of bankruptcy, VA loans offer leniency. Typically, you must wait two years after a Chapter 7 discharge before qualifying. For Chapter 13, you can apply after one year of making satisfactory payments, provided you have the court’s permission, meet debt to income requirements, have a stable work history and meet residual income requirements
Foreclosure Requirements for a Kentucky VA loan
Kentucky VA Home buyers will need to wait two years after a foreclosure (date home is sold) before applying for a VA loan. The 2 year seasoning requirement starts when the house deed is transferred back to the lender or person that bought it at foreclosure auction
Income Limits for Kentucky VA loans
Kentucky VA loans does not have income limits. However, your income must be sufficient to cover the mortgage payments and other obligations. Lenders will evaluate your residual income, which is the amount left after meeting your monthly obligations and check your debt to income ratio to see if you qualify for a KY VA home loan.
Funding Fees for Kentucky VA loans
The VA charges a funding fee to help cover losses on defaulted loans. The fee can be financed into the loan or paid upfront. The amount varies depending on factors such as the size of your down payment and whether it’s your first VA loan:
- First-time use with no down payment: 2.3%
- Subsequent use with no down payment: 3.6%
- see chart here->
Loan Limits for Kentucky VA loans.
Kentucky VA loans do not have a maximum loan amount, but there are limits on the amount the VA will guarantee without a down payment. For most counties in Kentucky, the limit is $726,200 in 2024. Borrowing above this limit typically requires a down payment.
Appraisal requirements for a VA loan in Kentucky
A VA appraisal is necessary to ensure the property meets minimum property requirements (MPRs) and is worth the purchase price. This appraisal includes an evaluation of the home’s condition and ensures it’s safe, sound, and sanitary. It is ordered through the VA portal by the lender doing your loan and it currently costs $605 in Kentucky for a va appraisal in KY. They will email or mail you a copy of your appraisal report and issue NOV on the report, which is a Notice of Value.
Termite Inspection for Kentucky VA loans
In Kentucky, a termite inspection is mandatory for Kentucky approval for VA loans. The inspection report must confirm that the property is free from active termite infestation. This helps protect both the lender’s and the borrower’s interests.
Title Report for Kentucky VA loans
A clear title report is required to confirm that there are no legal issues with the property’s ownership. The title company will conduct a thorough search to ensure there are no liens, claims, or disputes that could affect your ownership.
Closing the Loan in Kentucky For A VA loan.
The final step involves closing the loan, which includes signing the necessary paperwork and paying closing costs. These costs can include the VA funding fee, loan origination fees, and other related expenses. Once the loan is closed, you’ll receive the keys to your new home.
Summary
Obtaining a VA home mortgage loan in Kentucky involves several key steps:
- Check your credit score and work on improving it if necessary.
- Calculate your debt-to-income ratio to ensure it meets the VA’s guidelines.
- Ensure a stable work history of at least two years.
- Address any past bankruptcies or foreclosures, adhering to the required waiting periods.
- Verify your income to demonstrate your ability to make mortgage payments and meet the requirements for residual income and dti ratios
- Understand the funding fees and how they apply to your situation.
- Be aware of the Kentucky VA loan limits and plan accordingly if you need to borrow above these limits.
- Prepare for the appraisal and termite inspection to ensure the property meets VA standards.
- Secure a clear title report to avoid any legal issues.
- Close the loan, paying any necessary closing costs and finalizing the purchase.
By following these steps, Kentucky veterans can navigate the VA loan process efficiently and secure their dream home with favorable terms.
Joel Lobb Mortgage Loan Officer
American Mortgage Solutions, Inc.10602 Timberwood Circle
Louisville, KY 40223
Company NMLS ID #1364
Text/call: 502-905-3708
email: kentuckyloan@gmail.com
http://www.mylouisvillekentuckymortgage.com/
NMLS ID# 57916, (www.nmlsconsumeraccess.org).
