Kentucky First Time Home Buyer Mortgage Loan

What are VA Home Loans?

VA Loans provide military veterans and current service members a distinct advantage when it comes time to purchase or refinance a home. Today’s VA Loans have the most favorable terms available for most veterans. VA Loans can be used to purchase a new home with no down payment with no mortgage insurance or refinance up to 90% of a homes current equity.

What are the eligibility requirements for a VA Loan in Kentucky?

Veterans Affairs loan guidelines use two methods of income qualification in Kentucky. The residual income method is the primary method, where it is determined that the borrower has sufficient income to cover daily living costs once housing, taxes, insurance and all other liabilities like credit card and auto payments have been made. Additionally, VA loans use a debt to income ratio (DTI). Using this ratio, the veteran’s total debt should not exceed 41% of the veteran’s total income. Most lenders will require at least a 620 credit score for a VA Loan approval.

How much can I borrow?

The maximum VA Mortgage amount is determined by:

Maximum VA Loan in Kentucky: The largest loan allowed for VA mortgages with zero down is $417,000 in KY. Please refer to the Kentucky VA Loan Limit chart at the bottom of this page to see your area’s limit.

Maximum Finance: For purchase transactions, the Maximum VA Loan will be 100% of the lower of the selling price or the appraised value.

What will the down payment and closing costs be?

Kentucky VA loans have zero money down up to $417,000 in most counties.

What property types are allowed for VA Loans in Kentucky?

VA Loans may be used to purchase or refinance single family residences and VA approved condo projects if the property is the veteran’s primary residence.

Can I do a VA refinance in Kentucky?

Three kinds of VA Refinance programs are available for veterans in Kentucky.

Rate/Term VA Refinance

The Rate/Term VA Refinance can be used to refinance a conventional, FHA or subprime mortgage into a stable, fixed rate VA Loan.

VA Cash-Out Refinance

A Cash-Out VA Refinance is very beneficial for the veteran who wants to access the equity that they have built up in their home. VA Loans can be used to refinance up to 90% of a homes current value and take cash out for any reason.

Streamline Refinance

The VA Streamline Refinance is designed to lower the interest rate on a current VA mortgage or convert a current VA adjustable rate mortgage into a fixed rate. A VA Streamline Refinance Loan can be performed quickly and easily. It requires much less hassle and paperwork than a normal refinance including no appraisal, no qualifying debt ratios and no income verification.

How much can I refinance in Kentucky?

The maximum amount for an KY VA loan is determined by:

Maximum VA Loan in Kentucky: The largest loan allowed for a VA Mortgage varies from county to county. The highest maximum VA Mortgage right now is $1,094,625. The lowest maximum VA Mortgage amount available in any county is $417,000. To see what the limit is in the county in which you’re interested, visit the following page http://www.homeloans.va.gov/docs/2009_county_loan_limits.pdf. This site lists U.S. territories as well as states.

Maximum Finance: In Kentucky, The maximum VA refinance loan amount will be 100% of the appraised value of the home for a rate/term refinance or 90% of the appraised value for a VA cash out refinance.

What factors determine if I am eligible for a VA Refinance Loan?

VA refinance loans use two methods for income qualification purposes in Kentucky. The residual income method is the primary method, where it is determined that the borrower has sufficient income to cover daily living costs once housing, taxes, insurance and all other liabilities like credit card and auto payments have been made. Additionally, VA loans use a debt to income ratio (DTI). Using this ratio, the veteran’s total debt should not exceed 41% of the veteran’s total income. Most lenders will require at least a 620 credit score for a VA Loan approval.

Why choose a VA Home Loan?

Kentucky VA Mortgages require no down payment.

There are no prepayment penalties for VA Home Loans.

An Kentucky VA Loan is fully assumable, provided the person assuming is qualified.

VA Mortgage Loans have no PMI premiums.

A VA Mortgage Loan is eligible for non-credit qualifying, Streamline Refinance or “IRRRL”.

A VA Home Mortgage is available all areas of the country, provided a market exists for the property and the home meets VA’s property standards.

A VA Home Loan may be used to purchase or refinance a new or existing home.

Kentucky VA Loans are offered at terms of 15 or 30 years.

VA Refinance Questions & Answers

1. What are the guidelines for a VA Refinance?

If the borrower wishes to take cash out of the property, then the maximum financing amount is 90% of the appraised value, depending on the borrowers qualifications. If the borrower does not take cash out then the maximum financing will be 100% of the appraised value of the home or the amount you are refinancing plus closing costs, whichever is lower.

2. Why should I consider refinancing into a VA-insured mortgage?

VA refinance mortgages do not come with prepayment penalties, have no teaser rates nor balloon payments. They are offered at market rate with terms up to 30 years and are fully amortized, meaning that you pay towards principal and interest every month.

3. What if I have a prepayment penalty and other refinancing costs and there isn’t enough equity in my home to refinance?

If you do not have sufficient equity in your home to add your prepayment penalty and/or other refinancing costs into your new VA mortgage, then you should ask your current lender to consider a second mortgage to pay the difference or a short payoff on your existing loan. Offering either of these options is at the discretion of the lender.

4. Does it matter that the value of my home is now less than what I still owe?

Not to VA, but the current mortgage lender considering the refinance would have to be willing to accept a short payoff on the existing loan OR to hold a second mortgage to make up the difference needed to pay off the existing mortgage and the home’s value.

5. I have already obtained one VA loan. Can I get another one?

Yes, your eligibility is reusable depending on the circumstances. Normally, if you have paid off your prior VA loan and disposed of the property, you can have your used eligibility restored for additional use. Also, on a one-time only basis, you may have your eligibility restored if your prior VA loan has been paid in full but you still own the property.

6. Only a portion of my eligibility is available at this time because my prior loan has not been paid in full even though I don’t own the property anymore. Can I still obtain a VA guaranteed home loan?

Yes, depending on the circumstances. If a veteran has already used a portion of his or her eligibility and the used portion cannot yet be restored, any partial remaining eligibility would be available for use. The veteran would have to discuss with a lender whether the remaining balance would be sufficient for the loan amount sought and whether any down payment would be required.

7. Is the surviving spouse of a deceased veteran eligible for the home loan benefit?

The unmarried surviving spouse of a veteran who died on active duty or as the result of a service-connected disability is eligible for the home loan benefit. If you wish to make application for the home loan benefit as a surviving spouse, please contact us.

Kentucky VA Loan Limits
 

Area County Name Maximum Single Family Mortgage

(No Money Down) Maximum VA Jumbo

(0$ Down to 417k, 25% Down Above)

NON-METRO ADAIR 417,000 1,094,625

NON-METRO ALLEN 417,000 1,094,625

FRANKFORT, KY (MICRO) ANDERSON 417,000 1,094,625

PADUCAH, KY-IL (MICRO) BALLARD 417,000 1,094,625

GLASGOW, KY (MICRO) BARREN 417,000 1,094,625

MOUNT STERLING, KY (MICRO) BATH 417,000 1,094,625

MIDDLESBOROUGH, KY (MICRO) BELL 417,000 1,094,625

CINCINNATI-MIDDLETOWN, OH-KY-IN (MSA) BOONE 417,000 1,094,625

LEXINGTON-FAYETTE, KY (MSA) BOURBON 417,000 1,094,625

HUNTINGTON-ASHLAND, WV-KY-OH (MSA) BOYD 417,000 1,094,625

DANVILLE, KY (MICRO) BOYLE 417,000 1,094,625

CINCINNATI-MIDDLETOWN, OH-KY-IN (MSA) BRACKEN 417,000 1,094,625

NON-METRO BREATHITT 417,000 1,094,625

NON-METRO BRECKINRIDGE 417,000 1,094,625

LOUISVILLE-JEFFERON COUNTY, KY-IN (MSA) BULLITT 417,000 1,094,625

NON-METRO BUTLER 417,000 1,094,625

NON-METRO CALDWELL 417,000 1,094,625

MURRAY, KY (MICRO) CALLOWAY 417,000 1,094,625

CINCINNATI-MIDDLETOWN, OH-KY-IN (MSA) CAMPBELL 417,000 1,094,625

NON-METRO CARLISLE 417,000 1,094,625

NON-METRO CARROLL 417,000 1,094,625

NON-METRO CARTER 417,000 1,094,625

NON-METRO CASEY 417,000 1,094,625

CLARKSVILLE, TN-KY (MSA) CHRISTIAN 417,000 1,094,625

LEXINGTON-FAYETTE, KY (MSA) CLARK 417,000 1,094,625

NON-METRO CLAY 417,000 1,094,625

NON-METRO CLINTON 417,000 1,094,625

NON-METRO CRITTENDEN 417,000 1,094,625

NON-METRO CUMBERLAND 417,000 1,094,625

OWENSBORO, KY (MSA) DAVIESS 417,000 1,094,625

BOWLING GREEN, KY (MSA) EDMONSON 417,000 1,094,625

NON-METRO ELLIOTT 417,000 1,094,625

NON-METRO ESTILL 417,000 1,094,625

LEXINGTON-FAYETTE, KY (MSA) FAYETTE 417,000 1,094,625

NON-METRO FLEMING 417,000 1,094,625

NON-METRO FLOYD 417,000 1,094,625

FRANKFORT, KY (MICRO) FRANKLIN 417,000 1,094,625

UNION CITY, TN-KY (MICRO) FULTON 417,000 1,094,625

CINCINNATI-MIDDLETOWN, OH-KY-IN (MSA) GALLATIN 417,000 1,094,625

NON-METRO GARRARD 417,000 1,094,625

CINCINNATI-MIDDLETOWN, OH-KY-IN (MSA) GRANT 417,000 1,094,625

LEXINGTON-FAYETTE, KY (MSA) WOODFORD 417,000 1,094,625

We lend in all of Kentucky’s top cities:

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