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Today’s Rates for First Time Homebuyers in Kentucky
Friday, July 29, 2016
Mortgage rates are at 4.06% for the 30 year fixed loan program and at 3.17% for the 15 year fixed. As for variable rates, the 5/1 ARM rate currently stands at 3.75%. Check out FHA and VA rates as well if you are doing low or no down payments.
Kentucky First Time Home Buyer Checklist
What are your loan program options? If you're moving to an eligible area, you may qualify for a zero down payment loan through USDA. Veterans may be eligible for VA loans, which do not require cash down. The content in the paragraphs below should give you an idea of where you may fall.
Do you know your credit score? Your credit should fall somewhere above 600, but few lenders accept scores in the high 500s. If your credit score needs a boost, work on improving it before you try to take out a mortgage. Once annually, you're able to request a free credit report from the three major credit bureaus, Equifax, Experian or TransUnion.
Have you received interest rate quotes from at least three Kentucky lenders? Choose one who not only provides a great offer, but carries a high rating from the Better Business Bureau.
Have you been pre-approved, or at least pre-qualified? Once you've picked a lender, provide income documentation with your last two pay stubs and tax returns from the past two years.
Is your budget set? You could be pre-approved for a loan amount that is bigger than you had anticipated, but do not base affordability on the sum provided. Remember - pre-approvals are not guaranteed, and only you know what you can truly afford.
Do you have a piece of real estate in mind? While home shopping, avoid making extravagant purchases, taking out new installment loans, or anything else that could weaken your financial standing. Lenders will check your accounts again, and your loan may be denied.
Low Down Payment Loans Through FHA
If you’re a first time home buyer without a lot to put down, an Kentucky FHA loan may accommodate you. FHA loans are backed by the government and designed to help home buyers with limited upfront funds receive financing.
Down payment: 3.5%
Minimum acceptable credit score: 580 (varies)
Mortgage insurance: Upfront (1.75% loan amount) and monthly
Property guidelines apply and are verified via home inspection
You can find additional information about FHA loans on the Kentucky page of the FHA website.
No Down Payment Loans Through USDA
The United States Department of Agriculture backs home loans for zero down to Kentucky home buyers looking to move to or live in rural areas. Find out if your buying city is eligible by searching the USDA's property map. Note that popular areas like Louisville and Fayette are not eligible.
Down payment: None required; financing up to 102% available depending on home appraisal
Minimum acceptable credit score: 620
Mortgage insurance: Upfront (2% loan amount) and monthly