Category: Uncategorized

via Kentucky Housing Corporation (KHC)

Here are a few reminders about the Kentucky USDA Rural Housing Service (RHS) Section 502 Guaranteed program which provides very-low-, low- and moderate-income rural residents access to affordable housing finance options with little or no down payment or out-of-pocket costs.

• Eligibility Link – Access the USDA Home page, click here.
• Income – To determine eligibility of an applicant/household, click here.
• Property Eligibility – To determine whether the property is located in a designated rural area, click here.s

30 year fixed rate loan terms only, Purchase or refinance, If refinancing must be existing USDA home loan. No cash out allowed.
• Occupancy – Owner occupied only.
• Maximum Loan Amount-No max loan amount
• Max DTI – GUS approved, generally 45% (front end sensitive)/ Manual 29/41.
• Guaranty Fee/Annual Fee – there is a 1.00%/ 0.35% (monthly).
• Down Payment – Down payment not required but if…

Mortgage Insurance for Conventional Loans

Borrower-Paid Monthly (BPMI)
BPMI permits the borrower to pay the MI premium monthly, or as a single upfront premium.
BPMI helps lenders offset the risk of a low down-payment mortgage.
Borrowers can qualify for a loan with a smaller down payment, enabling them to purchase a home sooner.

Lender-Paid (LPMI)
Benefits the borrower and lender
With LPMI, the lender pays the MI premium on behalf of the borrower, thus allowing the lender to charge a slightly higher interest rate on the loan.
In addition to increasing loan volume, LPMI lets you realize additional servicing profits through secondary marketing execution. Benefits include:
Potential to originate larger first mortgages, resulting in higher servicing values
Increase retention rates and repeat loan transactions through higher customer satisfaction
Risk based pricing options can offer even better rates for credit worthy borrowers
Benefits to the borrower:
Lower down payment needed
Possibility…