Friday, August 23, 2013

KHC Loan Programs

KHC Loan Programs

KHC Loan Programs

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KHC offers two different funding sources: MRB and Secondary Market.

MRB FUNDING SOURCE

  • All MRB Kentucky Housing first mortgage loans are for a 30-year term at a fixed rate of interest.
  • The home you purchase through Kentucky Housing must be the only residential property you own and you must occupy the home as your principal residence while the loan debt is still outstanding.
  • To qualify, you must meet KHC’s regular MRB income guidelines, make a down payment or qualify for down payment assistance, be a U.S. citizen or legal alien and have an acceptable credit history.
  • Some MRB KHC loans are subject to a federal recapture tax. Recapture is a federal income tax that the borrowers may have to pay if they have considerable growth in their income and they sell or transfer their KHC-financed home within 9 years.  However, KHC has implemented a Recapture Tax Guarantee Program for all loans that close after October 1, 2006.  The Recapture Tax Guarantee Program will reimburse homeowners if they are subject to pay the Federal Recapture Tax on their KHC mortgage loan upon the sale of their home.

Conventional No Mortgage Insurance Program

  • Minimum credit score of 680 or better.
  • 3 percent down payment and no up-front or monthly mortgage insurance.
  • All KHC DAPs applicable.
  • No minimum borrower contribution.
  • No reserves required.

FHA

  • Insured by the Federal Housing Administration.
  • Down payments as little as 3.5 percent.
  • Can use DAP for 3.5 percent down payment requirement.
  • Upfront and monthly mortgage insurance.
  • Minimum credit score of 640.

VA

  • Guaranteed by the Veterans Administration for qualified military veterans.
  • No down payment if the property appraises for the sale price or greater.
  • Credit underwriting is flexible.
  • Minimum credit score of 640.
  • No monthly mortgage insurance payments.

RHS

  • Guaranteed by Rural Housing Services (RHS).
  • Home must be located in a rural area as defined by RHS.
  • No down payment if the property appraises for the sale price or greater.
  • Upfront and monthly mortgage insurance.
  • Minimum credit score of 640.

MRB Special Funding (Lender may begin reserving August 1, 2013)

KHC has a limited funding amount of $15 million for specific household types with lower household income limits through MRB Special Funding.  The program is available on first-come, first-served basis. 
Eligible Households include: 
  • Single parent with at least one dependent child under the age of 18 living in the home
  • At least one home buyer is age 62 or older
  • One member of the household has a permanent disability and is receiving disability income
Program guidelines: 
  • Interest rate is fixed at 2.5% without DAP or 3.00% with DAP
  • 640 credit score and AUS approval
  • Maximum ratios 40/45%
  • First-time homebuyer, unless property located in a targeted county
  • Executed purchase contract
  • Existing or new construction property -- purchase price limit of $115,000
  • Regular and Affordable DAP available
  • FHA, VA and RHS first mortgage programs
  • Gross annual household income limit of $35,000 for all household sizes
    • All household occupants (18 years and older) with income must be included on lan and be credit ready
     

SECONDARY MARKET FUNDING SOURCE

  • All Secondary Market first mortgage loans are for a 30-year term at a fixed rate of interest.
  • The home you purchase through KHC must be occupied as your principle residence while the loan debt is outstanding.
  • To qualify, you must meet KHC's GNMA income guidelines, make a down payment, or qualify for down payment assistance, be a U.S. citizen or legal alien and have an acceptable credit history.

Conventional No Mortgage Insurance Program

  • Minimum credit score of 680 or better.
  • 3 percent down payment and no up-front or monthly mortgage insurance.
  • All KHC DAPs applicable.
  • No minimum borrower contribution.
  • No reserves required. 

FHA

  • Insured by the Federal Housing Administration.
  • Down payments as little as 3.5 percent.
  • Can use DAP for 3.5 percent down payment requirement.
  • Upfront and monthly mortgage insurance.
  • Minimum credit score of 640.
Two FHA Refinance Options (Available Only Through Secondary Market)
  • Credit qualifying Streamline Refinance and Rate/Term Refinance
    • Insured by the Federal Housing Administration
    • Cash back to borrower not to exceed $500
    • Upfront and monthly mortgage insurance
    • Minimum credit score of 640
     

VA

  • Guaranteed by the Veterans Administration for qualified military veterans.
  • No down payment if the property appraises for the sale price or greater.
  • Credit underwriting is flexible.
  • Minimum credit score of 640.
  • No monthly mortgage insurance payments.

RHS

  • Guaranteed by Rural Housing Services (RHS).
  • Home must be located in a rural area as defined by RHS.
  • No down payment if the property appraises for the sale price or greater.
  • Upfront and monthly mortgage insurance
  • Minimum credit score of 640.

Home Buyer Tax Credit

KHC's Home Buyer Tax Credit is available through Mortgage Credit Certificates (MCC), which reduce the amount of federal income tax you pay, giving you more available income to qualify for a mortgage loan.  MCCs are NOT mortgages.  They are tax credits that put extra cash in your pocket each month, so you can more easily afford a house payment.  That means fewer tax dollars will be withheld from your regular paycheck, increasing your take-home pay.  The federal government allows every homeowner an income tax deduction for all the interest paid each year on a mortgage loan.  But an MCC gives you a tax credit of 25 percent (not to exceed $2,000).  You can still deduct the remaining 75 percent interest on your income taxes.  A tax credit is not the same as a tax deduction.  A tax deduction reduces the portion of your income that is taxed, so you pay less.  A tax credit is a direct, dollar for dollar reduction in the total tax you owe.  The MCC is effective for the life of the loan as long as you live in the home.  If you sell your home in the first nine years of ownership, you may be subject to Federal Recapture Tax.  One-time fee of $500 or reduced to $200 if through KHC's Secondary Market First Mortgage Program.  Not valid with MRB loan programs.
Applying for a Kentucky Housing Corporation loan is easy. Just contact one of our approved lenders near you and ask for a Kentucky Housing Corporation loan.



KENTUCKY HOUSING CORPORATION
2012 GROSS ANNUAL HOUSEHOLD INCOME LIMITS
Effective February 21, 2012

The income limitations listed below are imposed by federal law.
Failure to comply with them may create adverse consequences for Kentucky Housing Corporation and its bondholders.
Funding Source: New Bond Funds (Purchase Price Limit – $243,000)
Person(s) per household (1 or 2) (3 or more) Person(s) per household (1 or 2) (3 or more)
Anderson 67,369 77,475 Kenton 83,400 97,300
Ballard 64,320 75,040 Larue 68,520 79,940
Barren 58,200 67,900 Laurel 53,000 60,950
Boone 83,400 97,300 Livingston 61,440 71,680
Bourbon 80,520 93,940 Lyon 62,040 72,380
Boyd 58,200 67,900 Madison 66,720 77,840
Bracken 85,560 99,820 Marion 61,080 71,260
Bullitt 74,160 86,520 Marshall 67,560 78,820
Caldwell 54,840 63,980 McCracken 64,920 75,740
Calloway 62,040 72,380 McLean 68,760 80,220
Campbell 83,400 97,300 Meade 62,280 72,660
Christian 63,000 73,500 Mercer 66,960 78,120
Clark 80,520 93,940 Muhlenberg 53,000 60,950
Daviess 67,320 78,540 Nelson 68,880 80,360
Edmonson 68,880 80,360 Oldham 74,160 86,520
Fayette 67,229 77,314 Owen 66,480 77,560
Franklin 67,189 77,268 Pendleton 85,560 99,820
Gallatin 85,560 99,820 Robertson 60,840 70,980
Graves 58,440 68,180 Scott 80,520 93,940
Greenup 58,200 67,900 Shelby 75,770 87,135
Hancock 67,320 78,540 Simpson 66,120 77,140
Hardin 66,720 77,840 Trigg 63,000 73,500
Harrison 63,840 74,480 Trimble 76,560 89,320
Henderson 68,049 78,257 Union 66,960 78,120
Henry 76,560 89,320 Warren 64,560 75,320
Hickman 63,480 74,060 Webster 76,560 89,320
Jefferson 74,160 86,520 Woodford 67,229 77,314
Jessamine 67,229 77,314

For all other counties not listed above: $63,600 (1 or 2 persons) $74,200 (3 or more persons)
Lottery For Special Funding (Single Parents, Disabled, and Elderly Households)
Income Limit: $28,000 for households of 1-2 persons or $33,000 for households of 3 or more people.
Purchase Price Limit


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