Category: Income Guidelines

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
text or call my phone: (502) 905-3708
email me at
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, ( 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.

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.

2019 Kentucky VA Home Loans Requirements

Chapter 7 Two years from discharge date; evidence the applicants have demonstrated ability to handle their credit affairs; and that applicants have re-established acceptable credit (or chosen not to incur new credit). Discharged less than two (2) years – NOT eligible.
Chapter 13 A satisfactory performance history for one year of the pay-out period and MUST be discharged.
If occurred in past three years, applicant is ineligible.
All federal tax liens will be required to be paid in full prior to the loan closing.

CAIVRS is a HUD-maintained computer information system which enables lenders to learn when an applicant has previously defaulted on a federally-assisted loan. The system’s interactive voice response function provides instant credit information.
A CAIVRS screening on each veteran and any co-obligor is required. An applicant cannot be considered a satisfactory credit risk if he or she is presently delinquent or in default on any debt to the federal government until the delinquent account has been brought current or satisfactory arrangements have been made between the veteran and the federal agency.

Student Loans

If student loan repayments are scheduled to begin within 12 months of the date of VA loan closing, lenders should consider the anticipated monthly obligation in the loan analysis. If the borrower is able to provide evidence that the debt may be deferred for a period outside that timeframe, the debt need not be considered in the analysis.

Interested-Party Contributions/Property Seller Concessions
A maximum of 4% of the value of the property as indicated on the Notice of Value (NOV) may be contributed from an interested party (property seller concession).
Any property seller concession or combination of concessions which exceeds 4% of the established reasonable value of the property is considered excessive and unacceptable for VA-guaranteed loans. A reduction of the sales price in the amount equal to the excess is required in these instances.
Property seller concessions include, but are not limited to, the following: Payment of the VA funding fee Prepayment of the veteran’s property taxes and insurance Gifts such as a television set or microwave oven Payment of additional discount points to provide permanent interest rate buydowns Provision of escrowed funds to provide temporary interest rate buydowns Payoff of credit balances or judgments on behalf of the veteran
Property seller concessions do not include: Payment of the veteran’s closing costs Payment of points as appropriate to the market
o For example: if the market dictates an interest rate of 7.50 with two discount points, the property seller’s payment of the two points would not be a property seller concession. If the property seller paid five points, three of these points would be considered a property seller concession.

Closing Costs that CAN be Paid by the Veteran:
Appraisal Fee Recertification of Value Fee
Buydown Fee Recording of Deed
Compliance Inspection Recording of Mortgage
Credit Report Release Fee – Refinances Only
Discount Points Repairs listed on appraisal **
Documentary Mortgage Stamps Repair Inspection – Refinances Only
Flood Certification Septic Inspection Fee
Hazard Insurance Survey
Intangible Tax Title Insurance including: Abstract, Binder & Exam
Origination Fee – 1% Max * VA Funding Fee
Pest Inspection – Refinances Only*** Water Test Fee
Closing Costs that CANNOT be Paid by the Veteran:
Attorney Services (other than title work) Postage, Fax, Phone, Copy of Courier Fees
Broker Fees Sales Commissions
Pest Inspection on Purchase*** Realtor/Lender Transaction Fee

VA Loans Louisville Kentucky

VA Loans Louisville Kentucky.

via VA Loans Louisville Kentucky.

Louisville Kentucky VA Mortgage

This website is not an Government Agency, and does not officially represent the HUD, VA, USDA or FHA or any other government agency. 


Louisville Kentucky VA home mortgage loans offer many benefits to qualified veterans.  Did you know that since 1944, when home loan guarantees were part of the original GI Bill, the Veterans Administration has guaranteed over 18 million home loans totaling more than $911 Billion?  Loans are available for purchasing or refinancing a home.  Here are a few of the Louisville Kentucky VA mortgages being offered to qualified veterans today.

Benefits of Louisville Kentucky VA Home Mortgage Loans

VA Home Purchase Loans – Zero Down Payment

This Louisville Kentucky VA Home Loan program allows veterans with qualifying income and credit to purchase a primary residence with zero money down towards the sale price of the home, providing the sale price does not exceed the appraised value of the home. Closing costs can be negotiated and paid by the seller. Other benefits to the Louisville Kentucky VA home purchase loan are: Loans are assumable; closing costs are limited by the Veterans Administration, making sure the costs are fair; the VA is behind you with additional assistance if you ever have a problem making your loan payments; veterans can prepay their home loan without a penalty; the VA benefit is not limited to first time veteran homebuyers, veterans may reuse his or her benefit again; and private mortgage insurance is not required on the loan.

Louisville Kentucky VA Refinance Loans Available

Louisville Kentucky Conventional loan to Louisville Kentucky VA refinanceIf you qualify for a Louisville Kentucky VA loan but do not currently have one, you can now refinance your current existing mortgage to a VA home mortgage loan. The fee for refinancing your conventional mortgage to a VA mortgage is currently 2.51% for veterans who are first-time users.  You can benefit by a possibly lower interest rate than what you currently have, and there is no monthly mortgage insurance or out of pocket closing costs on the new Louisville Kentucky VA loan. Many lenders offer Louisville Kentucky VA home mortgage loans and rates will vary, so shop the rate with several lenders to see if the current low rates being offered on these loans today can benefit you.

VA Streamline Refinance – This loan is for current veterans who have an existing VA loan and wish to lower their interest rate. These loans are sometimes referred to as “Interest Rate Reduction Refinancing”.  Being one of the most popular VA loans, veterans often choose this loan program because Louisville Kentucky  mortgage rates are low for those who want to streamline a Louisville Kentucky mortgage refinance.  It’s called a streamline refinance due to having no out of pocket costs, no required appraisal and no income or credit check is needed to qualify.  Reason being, veteran borrowers have already qualified when obtaining their current mortgage that they now wish to refinance, which make these loans close faster due to less documentation.

Louisville Kentucky VA Cash Out Refinance – Veterans in need of utilizing the equity in their homes to gain cash proceeds for any number of reasons can qualify for the VA cash out refinance loan.  This loan allows for an amount up to 90% of the home’s value.  No out of pocket closing costs and no monthly mortgage insurance is required.

VA Home Mortgage Loans: Help for Borrowers in Delinquency

VA home mortgage loans offer help and advice for borrowers that have become delinquent in their VA mortgages.  The Department of Veterans Affairs announced recently some general guidance for borrowers who may be encountering difficulties.

Advice from the US Department of Veterans Affairs

The DVA announced in February 2011 that “They are urging all veterans who may be encountering problems with making their mortgage payments to speak with their servicers as soon as possible to explore options to avoid foreclosure.  Contrary to popular belief, servicers really do not want to foreclose on the loans, due to foreclosure actions being highly costly.”

Possible Options from VA Loan Servicers

Depending on the veteran’s specific situation, servicers may offer any of the following options to avoid foreclosure for VA borrowers in default on their loans:

Repayment Plan – The borrower makes regular installment payments each month plus part of the missed installment payment(s).

Special Forbearance – When the servicer agrees not to initiate foreclosure actions allowing time for borrowers to repay the missed loan installments. For example: when a borrower is waiting for a tax refund that enables them to make up the missed payments, and commits to bringing the loan current upon receiving the tax refund.

Loan Modification – This provides the borrower a fresh start, adding the delinquency amount to the home mortgage loans balance and establishing a new payment schedule.

Additional time to arrange a private sale – The servicer agrees to delay foreclosure, to allow time for a sale on the home to close and paying the loan off with sale proceeds.

Short Sale – When the servicer agrees to allow a borrower to sell his/her home for a predetermined lesser amount than what is currently required to pay off the loan.

Deed-in-Lieu of ForeclosureBorrower(s) voluntarily agrees to deed the property to the servicer instead of going through a lengthy and costly foreclosure process.

Service Members Civil Relief Act (SCRA)

Pursuant to the SCRA veteran borrowers may be able to request relief.  The intention of SCRA is to ease the economic and legal burdens on military personnel during their active service.  To qualify for certain protections available under the act, veteran borrowers must request protection under the Act; and the loan must have originated prior to the current period of active military service.  SCRA may provide borrowers lower interest mortgage rates; prevent foreclosure or eviction up to nine months from the period of military service.

Assistance for Veterans with VA Guaranteed Home Loans

If a VA guaranteed home loan becomes delinquent, VA can help by providing supplemental servicing assistance to help resolve the default. Loan servicers have the primary responsibility of servicing the loan to cure the default. However, in cases where the loan servicer is unable to help the veteran borrower, Loan Guaranty has loan technicians in 8 Regional Loan Centers and 2 special servicing centers who will take an active role in interceding with the original loan servicer in exploring all options to avoid foreclosure.

The US Department of Veterans Affairs also offers assistance to those veterans with non-VA Guaranteed Home Loans, and for homeless veterans.   For veteran borrowers that VA is not able to help, the HOPE NOW Alliance may be of assistance; this is a joint alliance of servicers, counselors and investors who all have the same goal, to assist distressed borrowers in retaining their homes and avoid foreclosure.

For Borrowers who have delinquent Louisville Kentucky VA home mortgage loans and need assistance, the DVA can be good source for help.

There are considerable advantages to the VA loan programs available to qualified veterans today.  We’re and we help assist veterans every day in finding the right home mortgage loansthat work for them, and we can help you too.  Contact us today!

Kentucky VA Loans

Kentucky VA Loans.

via Kentucky VA Loans.

Kentucky VA Home Loans Approval Criteria

What Criteria Does the VA Use to Approve a Kentucky  VA Mortgage Loans?

What does the VA use to approve Kentucky VA mortgage loans?

If you’re a first-time buyer, VA loans may strike you as confusing and may even be a little daunting. This is because there are a lot of misconceptions about VA mortgage loans, not least of which is the concern on who issues the loan.

It is important to keep in mind that VA guarantees the loan but it does not insure it. Once you are aware of it, you will be able to understand the role that VA plays in the lending process.

Who approves my loan?

According to the VA, many, if not all, VA home loans are approved by the lender using the lending guidelines and criteria which are drafted by the VA. While still in the process of servicing a VA loan, there are several people who usually discuss what the VA will likely approve or decline – in fact, numerous articles with topics revolving VA loans even state it in terms of a particular agency approving an individual loan.

In many situations, the discussions really refers to the rules that are under government regulations. When the VA is required to take care of an individual case, more often than not it means that the situation isn’t properly addressed by existing rules or that the lender still needs additional details.

What is required for my loan to be approved?

Simply put, there are two basic methods set in the VA mortgage guidelines that will determine if an applicant is qualified for a loan. The first thing that will be considered is your income. This is what is referred to as the residual income method.

You will have to ask yourself: can you actually afford to pay the daily costs of the VA home loan? Are your debts too big that you won’t be able to handle an additional monthly mortgage anymore?

You will also need to take into consideration things like your car payment and credit card payments. The second qualification to consider is a more definite examination of the said issues, based on a formula commonly referred to as debt-to-income ratio.

VA Income Requirement Guidelines are similar to other programs.  This is not an inclusive list of items needed.  Documentation may be more of less perLender requirements or through the use of automated underwriting engines such as DO/DU(FNMA) or LP(FHLMC)

Employment verification general requirement

  • Verify a minimum of 2 years employment.
  • If not employed by the present employer less than 2 years:
    Verify prior employment plus present employment covering a total of 2 years;
  • Gaps of employment great than 30 days may need explanation
  • Current paystubs for 1 months time period.  Paystub must contain YTD information.
  • W-2 forms for the past 2 years


  • Provide an explanation of why 2 years employment could not be verified.

Borrowers that are self employed will need to provide the following:

VA’s debt-to-income ratio is a ratio of total monthly debt payments (housing expense, installment debts, etc.) to gross monthly income is generally 41%:

Though Debt Ratios may exceed the 41%, if not approved through and automated underwriting engine such as DO/DU(FNMA) or LP(FHLMC) then and underwriter will be looking to make sure that there are some compensating factors. 

In addition, underwriter need to review and verify that there is sufficient residualincome for family support available for the Veteran after making the loan.



Compensating factors may affect the loan decision. These factors are especially important when reviewing loans which are marginal with respect to residual income or debt-to-income ratio.They cannot be used to compensate for unsatisfactory credit.

Valid compensating factors should logically be able to compensate (to some extent) for the identified weakness in the loan. For example, significant liquid assets may compensate for a residual income shortfall whereas long-term employment would not.

Compensating factors include, but are not limited to the following:

Excellent credit history
Conservative use of consumer credit
Minimal consumer debt
Long-term employment
Significant liquid assets
Sizable downpayment
The existence of equity in refinancing loans
Little or no increase in shelter expense
Military benefits
Satisfactory homeownership experience
High residual income
Low debt-to-income ratio
Tax credits for child care, and
Tax benefits of homeownership.