Another option is something called "Lender paid mortgage insurance, or LPMI). You can put as little as 5% down and have the lender pay a one time mortgage insurande premium for you, which will eliminate monthly mortgage insurance on your loan.
KHC is used for mostly applicants in urban areas of Kentucky that don't have access to USDA or other government agencies to buy a home with no down payment.
Down Payment Assistance for Ky First Time Home Buyer, 100% Financing
You cannot have an owed a home in the last 3 years to use KHC down payment assistance to buy a home with zero down.
Kentucky Housing Program guidelines:
First-time home buyers, unless property is located in a targeted county.
Interest rate is fixed at 2.5 percent without Down payment Assistance Program (DAP) or 3.0 percent with DAP.
Maximum ratios 40/45 percent.
Executed purchase contract.
Existing or new construction property (purchase price limit $234,000).
Regular and Affordable DAP available.
FHA, VA, and RHS first-mortgage programs.
640 credit score and AUS approval.
Gross annual household income limit of for all household sizes.
Joel Lobb (NMLS#57916)
Senior Loan Officer
This web site is not the FHA, VA, USDA, HUD or any other government organization responsible for managing, insuring, regulating or issuing residential mortgage loans.
**Download Fair Housing Booklet â€“ CLICK HERE
All approvals and rates are not guaranteed, and are only issued based on standard mortgage qualifying guidelines
- See more at: http://activerain.com/blogsview/4247651/kentucky-first-time-
Annual Plan â€“ The first year premium is collected at closing, and then monthly payments are held in escrow for the following year.
Monthly Plan â€“ Two months of MI is paid at closing, then collected monthly as part of the mortgage payment.
Zero Upâ€“Front Plan â€“ Use that money for the down payment instead, as MI is paid monthly with the first mortgage payment, not at closing.
Single/Financed Premium â€“ Entire MI premium is paid at closing, and can be paid with down payment assistance or financed into the loan.
Split Premium â€“ A combination of single premium and the monthly plan; the seller can help with the upâ€“front premium or it can be financed in, resulting in lower monthly premiums.
Single Premium Lender Paid Mortgage Insurance (LPMI)4â€“ "Life of Loan" mortgage insurance that is paid after closing by the lender; no annual or monthly premiums or renewals.
Kentucky Mortgage and PMI, PMI Mortgage insurance, MIP, Mortgage insurance,
Joel Lobb (NMLS#57916)
Senior Loan Officer
Key Financial Mortgage Co. (NMLS #1800)*
107 South Hurstbourne Parkway*
Louisville, KY 40222*
The different types of mortgage insurance available for Louisville Kentucky Fannie Mae Conventional Mortgage Loans
CHIP loans offer home buyers the following benefits:
Up to 97% financing on the majority of allowed property types
First-time home buyers and previous homeowners eligible
Private mortgage insurance waived
A CHIP loan may be right for you if you:
Are unsure about qualifying income*
Are concerned about funding a large down payment
Lack of credit history
The following types of property are eligible for CHIP loans:
Single family homes
Doublewide manufactured homes on permanent foundations
Maximum loan amount varies depending on property location and is subject to change without notice.
*Income cannot exceed 80% of your county median income. Consult your BB&T Mortgage Professional for details.
Why does PMI exist?
Mortgage companies have found that those with less that 20% equity are more likely to default on a mortgage. The good news is that PMI allows homeowners to get into a house at good mortgage rates with less than 20% down. That's about 1.5 Million homeowners in 1999 - about 10% of all mortgages.
The purpose of PMI is to pay the mortgage company if the homeowner defaults on the mortgage.
Who pays for private mortgage insurance?
The borrower pays for mortgage insurance on a monthly basis in addition to the principal and interest payments that are made on a loan. The lender then transfers these premium payments to the mortgage insurance company.
Besides a monthly premium, are there any upfront fees to pay?
Yes. MI companies offer several options to the borrower at the time of closing. A monthly premium plan requires two monthly premiums be paid during the closing, with a set monthly premium due thereafter as part of the required mortgage payment.
An annual plan requires one year of premiums paid at time of closing, with a lower monthly premium due thereafter.
It is generally recommended that the borrower choose the lower upfront insurance premiums at time of closing with a slightly higher per month premium due thereafter.
Do I have to pay mortgage insurance if I have less than a 20% down payment for a home?
No. There are several ways to avoid private mortgage insurance premiums.
The first is to purchase a home with a combination first and second mortgage. The first mortgage would be limited to 80% of the home's appraised value. The second mortgage, which would close in conjunction with the first, would then provide for the difference between the home's purchase price, less the 80% first mortgage, less the down payment available . In other words, if you have a 10% down payment available, your first loan would provide for the 80% mortgage with a second mortgage of 10%. This is commonly referred to as an 80 -10 -10 transaction.
Another way to avoid incurring MI payments is to find a lender that offers self-insured programs. This type of loan would have a higher interest rate in place of the private mortgage insurance premium. While mortgage insurance premium payments are not tax deductible, the interest associated with a self-insured mortgage would be fully tax deductible.
The decision of whether to obtain a loan with mortgage insurance versus the above two options should take into account the combined total monthly payments of the various options, adjusted for the tax benefits of interest deductions.
Once my loan to value ratio drops below 80%, can the MI be removed?
Yes. Lenders will allow borrowers to remove the MI requirement once the property's appraised value increases such that the loan to value ratio is below 80%. The reality of trying to accomplish this can be somewhat challenging. Usually the lender will require that an appraisal be done by the lender's approved appraisal companies. Contact your current mortgage holder to determine their policy on removing mortgage insurance from an existing loan.
Another means to remove the MI is to refinance the original mortgage with the higher appraised value used to determine the new loan's loan to value ratio. However, if the current first mortgage held by a borrower is at favorable terms, it is definitely worth working with the current mortgage holder to eliminate the MI pre
Hello there! A lender would be glad to give you an "informed" answer to your question. I have clients right now that were according to them to secure a no PMI loan, however their details were very specific.
If you might like to speak to some of the lenders that I do business with on a daily basis, I would glad to refer you.
Please call me at 678-595-8115 or feel free to email me at email@example.com!
All the best!
Which solutions are available to you depends on your situation and purpose for the purchase.
There are even BETTER options available for those in select situations. It all starts with a conversation with your REALTOR to assess your situation.
Best of success,
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL
do LPMI (lender paid PMI)
Contact a local mortgage broker and he or she should be able to steer you in the right direction. Good luck!
Also, depending on where you purchase a home in Kentucky, the property itself may qualify for a USDA loan, which offers 100% financing and very minimal mortgage insurance compared to others. (There are income and property restrictions, so you'll want to speak to a loan officer to check on this for you.)