Showing posts with label Credit Score. Show all posts
Showing posts with label Credit Score. Show all posts

FHA loans are a popular option for Kentucky home buyers' with bad credit

FHA loans remain a top choice for Kentucky homebuyers with less-than-perfect credit 


Kentucky FHA Loan Requirements for to include Credit Fico Scores, Down Payment, Income and Job history


Credit score:


* The minimum credit score for an FHA loan in Kentucky is 500 to 580 depending on your credit score and down    payment. However, some lenders may accept scores as low as 500 with a larger down payment (10% instead of 3.5%).

Debt-to-income ratio:


* Your debt-to-income ratio (DTI) is your monthly debt payments divided by your gross monthly income. Most lenders prefer a DTI below 50%, but some may allow up to 56.9%.

Down payment:


Employment and income:


* You'll need to have steady employment for at least two years and sufficient income to cover your monthly mortgage payment.


* You'll also need to meet other requirements, such as having a valid Social Security number and homeowner's insurance.

If you have bad credit and are considering an FHA loan in Kentucky, it's important to shop around and compare rates from different lenders. You may also want to consider talking to a credit counselor to help improve your credit score before you apply.



The reasons you will get turn down for a mortgage loan in Kentucky

Top 10 Reasons Mortgage Loans Are Denied in Kentucky (FHA, VA, USDA & Fannie Mae)


There are several reasons why people in Kentucky might get turned down for a mortgage loan. These reasons can be broadly categorized into issues with the borrower or the property:


Borrower-related reasons:

  • Credit score: Low credit scores (generally below 620) are a major factor in loan denials. Having a history of late payments, delinquencies, or collections can negatively impact your score.
  • Debt-to-income ratio (DTI): This ratio compares your monthly debt payments to your gross income. A high DTI (generally above 50%) indicates you have a lot of debt compared to your income, making it harder to afford a mortgage payment.
  • Employment history: Lenders prefer borrowers with stable employment and income. Recent job changes, gaps in employment, or insufficient income documentation can raise concerns.
  • Down payment: A smaller down payment increases the loan amount and loan-to-value ratio (LTV), making the loan riskier for lenders. In Kentucky, FHA loans require a minimum 3.5% down payment, while conventional loans typically require 20%.
  • Insufficient assets: While not always a disqualifier, having limited savings or assets can weaken your application by reducing your financial cushion.

Property-related reasons:

  • Appraisal value: If the appraised value of the property is lower than the purchase price, it creates a high LTV, making the loan riskier for lenders.
  • Property condition: Major repairs or structural issues with the property could require significant investment before closing, which lenders may not be comfortable with.
  • Location: Properties in floodplains or other high-risk areas may be ineligible for certain loan types or require additional insurance.
turndown for mortgage,bad credit,credit,Credit Score,Debt to Income Ratio,fha income,job gaps,job loss,new job,time on the job,down payment assistance and first time home buyer grants,appraisal,




Here are some resources that can help:

Joel Lobb  Mortgage Loan Officer

American Mortgage Solutions, Inc.
10602 Timberwood Circle
Louisville, KY 40223
Company NMLS ID #1364

Text/call: 502-905-3708
fax: 502-327-9119
email:
 kentuckyloan@gmail.com

http://www.mylouisvillekentuckymortgage.com/

WHY WAS MY MORTGAGE DENIED? TOP 10 REASONS 1 Low Credit Score Your credit score falls below the minimum required for the loan program 2 High Debt-to-Income Ratio Your monthly debts are too high compared to your gross monthly income 3 Insufficient Employment History Less than 2 years of steady employment or frequent job changes 4 Inadequate Down Payment Insufficient funds for down payment, closing costs, or cash reserves 5 Property Appraisal Issues Home appraises for less than purchase price or has significant defects 6 Recent Bankruptcy/Foreclosure Past financial difficulties within the required waiting period (2-7 years) 7 Undocumented Income Cannot verify income, especially for self-employed or commission-based workers ? 8 Large Unexplained Deposits Recent large deposits in bank accounts that cannot be properly documented $ ! 9 Taking on New Debt Opening new credit cards, financing cars, or major purchases during loan process 10 Incomplete/Inaccurate Application Missing documents, inconsistent information, or errors on your mortgage application Don't Let Denial Stop You! Most of these issues can be overcome with proper preparation and expert guidance Get Expert Help Today Over 20 Years Experience | 1,300+ Kentucky Families Helped πŸ“§ kentuckyloan@gmail.com πŸ“ž 502-905-3708 Joel Lobb - Mortgage Loan Officer NMLS #57916 | Company NMLS #1738461 Equal Housing Lender

Kentucky Homebuyers: Steps to Check FICO Score for Mortgage Approval




Kentucky first-time homebuyers: Learn how to check your FICO score for FHA, VA, USDA, and KHC loans and improve your chances of mortgage approval.

Why Your FICO Score Matters for Your Kentucky Home Loan

If you’re buying your first home in Kentucky, your FICO® credit score is one of the most important factors in getting approved for a mortgage. Lenders use your score to determine:

  • Whether you qualify for a loan

  • How much you can borrow

  • The interest rate you’ll pay

This applies to all common Kentucky loan programs, including FHA, VA, USDA Rural Housing, and Kentucky Housing Corporation (KHC) loans.

New FICO Program Makes Getting Your Score Easier

FICO recently launched the Mortgage Direct License Program, which allows lenders to get and share FICO Scores directly with borrowers.

What this means for you:

  • Lenders may save money and pass along efficiency to borrowers

  • Your mortgage application process could move faster

  • There’s more transparency in how your credit score is used

You still don’t need to buy your FICO score yourself—your lender will pull it during pre-approval.

Minimum FICO Score Requirements for Common Kentucky Loans

Each loan program has different credit score expectations:

  • FHA Loans: Usually 580+ for 3.5% down

  • VA Loans: No official minimum, but most lenders prefer 620+

  • USDA Loans: Typically 640+ for automated approval

  • KHC Loans: Follows FHA, VA, and USDA guidelines, sometimes with additional overlays

Even if your score is below these numbers, there are often ways to improve it before applying.

Steps Kentucky Homebuyers Should Take

  1. Check Your Credit Reports – Get a free report from AnnualCreditReport.com and review for errors.

  2. Work with a Licensed Kentucky Mortgage Lender – They will pull your FICO score and explain your options for FHA, VA, USDA, or KHC loans.

  3. Improve Your Credit if Needed – Pay down debts, avoid late payments, and address collections.

  4. Get Pre-Approved – This lets you know exactly how much home you can afford and shows sellers you’re serious.

Why First-Time Homebuyers in Kentucky Should Care

With the new FICO program:

  • Lenders have more options to deliver scores directly

  • You could see faster approvals

  • It’s easier to understand what your score means for your loan

This is especially important if you’re looking at programs with low down payments or assistance options, like FHA, USDA, VA, or KHC.


Internal Links to Explore

External Resources


Compliance Note: This article is for educational purposes and is not financial advice. Loan approval depends on credit, income, debt, and program eligibility. Always consult a licensed Kentucky mortgage professional before applying.




Joel Lobb 

πŸ“ž Call/Text - 502-905-3708


 www.mylouisvillekentuckymortgage.com
 911 Barret Ave., Louisville, KY 40204


Evo Mortgage
Company NMLS# 1738461
Personal NMLS# 57916

Kentucky Mortgage Loan Expert For Kentucky FHA, VA, USDA, Fannie Mae and KHC Down payment Assistance Loans