Moody’s Assigns Aa3 to Logan County Public Prop. Corp., KY’s $7.7M First Mortgage Refunding Revenue Bonds

by Shelton on March 4th, 2016

filed under Below Average Credit

New York, February 04, 2016 — Issue: First Mortgage Refunding Revenue Bonds (Justice Center Project), Series 2016; Rating: Aa3; Sale Amount: $7,650,000; Expected Sale Date: 02-17-2016; Rating Description: Lease Rental: Appropriation

Summary Rating Rationale

Moodys Investors Service has assigned a Aa3 rating to $7.7 million Logan County Public Properties Corporation, KYs First Mortgage Refunding Revenue Bonds (Justice Center Project), Series 2016. The bonds are expected to price on or around February 17. The outlook is stable.

The rating is based on the credit quality of the Commonwealth of Kentucky (issuer rating of Aa2, stable), the subject-to-appropriation nature of the payments supporting the bonds, and the commonwealths significant reliance on appropriation-backed financings to fund capital investments. The rating also reflects Kentuckys record of proactive financial control and an economy that has benefitted from auto sector recovery. Low per-capita income levels, above-average state debt and very large unfunded pension liabilities contribute to a below average credit profile compared to most other states.

Rating Outlook

Kentuckys outlook is stable based on the expectation it will continue to manage its finances responsibly and work to improve the financing of teacher pensions, against a background of continued below-average state economic growth.

Factors that Could Lead to an Upgrade

Sustained economic slowing, resulting in weaker revenue performance that strains commonwealth finances

Build-up and maintenance of reserves

Significant reduction in adjusted net pension liabilities (ANPL)

Factors that Could Lead to a Downgrade

Sustained economic slowing, resulting in weaker revenue performance that strains commonwealth finances

Depletion of reserves with no replenishment, or indications of strained liquidity

Continued trend of negative GAAP basis ending balances, or continued reliance on non-recurring resources, particularly use of additional deficit financing, to balance the commonwealths budget

Failure to address large net pension liabilities

Legal Security

PAYMENTS FOR DEBT SERVICE PROVIDED UNDER BIENIALLY RENEWABLE LEASE

The bonds are payable solely from lease rental payments from the commonwealths Administrative Office of the Courts under a lease agreement, as supplemented, with the corporation. Per the lease, AOC is obligated to make rental payments, including payment of a Use Allowance equal to debt service and an Operating Costs Allowance payment to cover operating costs.

AOC is obligated to make semi-annual rental payments of the Use Allowance directly to the trustee two business days prior to the debt service payment due dates. The Operating Costs Allowance payment is made to the county. Rental payments are made pursuant to the terms of the lease agreement, which is automatically renewable for successive biennial periods unless terminated in writing by AOC.

AOC covenants in the lease to seek sufficient legislative appropriations to make rental payments for each biennial period. The General Assembly has no obligation to make appropriations for rental payments, and AOC has no obligation to renew the lease. Under the Mortgage Deed of Trust, a foreclosable mortgage lien on the project has been granted to the trustee. In addition, the interests of the corporation in the lease (excluding the Operating Costs Allowance) have been assigned to the trustee. In the event of a default on the bonds, the trustee may sell or re-let the facility to benefit bondholders. The lease may be amended to reduce AOCs use of the facility and, correspondingly, reduce its required rental payments. Any such amendment, however, would be contingent on the countys assumption of the reduced portion and confirmation by Moodys that the outstanding rating on the bonds would not be withdrawn or downgraded as a result of the amendment.

LEASE PERMITS ABATEMENT, RENTAL CREDITS

Should the project be destroyed or damaged such that it is rendered unusable by AOC, rental payments may be abated until AOC regains use of the project. As protection against such an event, rental interruption insurance sufficient to cover twenty-four months of debt service is required per the lease. In addition, the lease provides for an assessment of whether or not the project could be sufficiently renovated in twenty-four months. If the project cannot be repaired within twenty-four months of the date of damage to the point that it is sufficiently of use to AOC that AOC will make rental payments, insurance proceeds will be used to discharge the bonds. Per the lease, casualty insurance is provided at full replacement value of the project. Certain rental credits are permitted if AOC incurs operating costs in performing maintenance or other functions that are the obligation of the county under the lease. These credits, however, may only be taken against the Operating Costs Allowance, which AOC pays to the county for operating costs.

Use of Proceeds

The bonds are being issued to advance refund the Logan County Public Properties Corporation First Mortgage Revenue Bonds (Justice Center Project) Series 2008. The refunding plan is being undertaken to provide interest cost savings to the county and the AOC.

Obligor Profile

The Commonwealth of Kentucky has a population of 4.4 million people and a gross state product of $150 billion. It has a large and diverse economy, but relatively low wealth levels.

The commonwealth has a four-tiered court system called the Court of Justice that includes the Supreme Court, the Court of Appeals, circuit courts and district courts. The Administrative Office of the Courts (AOC) serves as the staff for the Court of Justice, administered by the Commonwealths Chief Justice of the Supreme Court. AOCs duties include, among other things, providing offices and court space for the entire court system and dispersing and maintaining supplies and equipment. The Court of Justice is funded through appropriations from Kentuckys General Assembly and represents approximately 3% of the total General Fund.

Logan County Public Properties Corporation is a nonprofit, non-stock public and governmental corporation organized and existing under the law of the Commonwealth. The corporations principal purpose is to act as an agency and instrumentality of the county in the planning, promotion, development, financing and acquisition by the corporation for and on behalf of the county of public improvements and public projects for the county.

Methodology

The principal methodology used in this rating was The Fundamentals of Credit Analysis for Lease-Backed Municipal Obligations published in December 2011. Please see the Ratings Methodologies page on www.moodys.com for a copy of this methodology.

Regulatory Disclosures

For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moodys rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the rating action on the support provider and in relation to each particular rating action for securities that derive their credit ratings from the support providers credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moodys legal entity that has issued
the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com
for additional regulatory disclosures for each credit rating.

Anne Cosgrove
Lead Analyst
State Ratings
Moodys Investors Service, Inc.
7 World Trade Center
250 Greenwich Street
New York 10007
US
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Emily Raimes
Additional Contact
State Ratings
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Releasing Office:
Moodys Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
USA
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Moodys Assigns Aa3 to Logan County Public Prop. Corp., KYs $7.7M First Mortgage Refunding Revenue Bonds

7 Steps You Need to Take Before Buying a Car in Dallas

by Shelton on March 1st, 2016

filed under Below Average Credit

This content is sponsored by Air Force FCU, which serves the diverse needs of members worldwide with a full array of financial services. The credit union serves service members from all branches of the military, Department of Defense, National Guard and their families.

Whether you work in downtown Dallas or commute to a job in the Fort Worth Stockyards, you likely rely on your car to get around this sprawling Metroplex. If you’re in the market for a new or used car to drive around Dallas, take these seven steps to get the best auto deal possible — and maybe even save some cash for Dallas Cowboys tickets.

Related: Why Paying Off Your Auto Loan Early Doesnt Always Save Money

1. Build Healthy Financial Habits

According to myFICO’s Loan Savings Calculator, improving your credit score can save you thousands of dollars in interest over the life of a loan. For example, Texas residents with credit scores in the highest range — from 720 to 850 — will likely qualify for a 60-month new auto loan with a 3.339% APR, which adds up to $1,744 in interest over the life of a $20,000 loan. On the other hand, borrowers with credit scores in the lowest range — from 500 to 589 — can be saddled with a 14.326% APR, resulting in a whopping $8,125 in interest over the course of five years.

In Dallas, the average consumers credit score is 652, according to Experian’s 2015 State of Credit Report, which uses the Vantage model to determine credit score. To boost your number toward the higher end of the spectrum, focus on paying bills on time, carrying little to no credit card debt and keeping your utilization rate — the percentage of available credit that you are using — low. You should also regularly request copies of your credit report and review it for mistakes. Correcting errors can boost your score and lead to lower interest rates on Dallas auto loans.

Additionally, many Dallas auto buyers save money by securing their car loans from credit unions like Air Force Federal Credit Union instead of relying on dealer financing. Air Force FCU offers its members financial advisement services as well. We look for ways to [help our members] save when buying a car, help determine their budget or even consolidate their existing debt to improve the credit profile and get better rates, said Monica Olivarez, Air Force FCU senior loan officer.

Related: 7 Mistakes to Avoid When Refinancing a Car Loan

2. Save for a Down Payment

By putting healthy down payments on Dallas cars, buyers can often secure lower interest rates on their auto loans. If you have a below-average credit score, you might be required to put down at least 10 percent of the car’s cost to qualify for financing, according to car cost-comparison site Edmunds.com.

No matter your score, a larger down payment can help minimize how much debt you need to take on and the amount of interest you will pay on that debt over the life of the loan. For best results, save some cash before you start shopping for a car in Dallas.

3. Determine What Type of Car You Want — and Need

Auto-buying expert Mike Rabkin recommended that car buyers consider their specific needs early on in the sales process. For example, do you have a long commute that makes good gas mileage crucial? Is a vehicle’s environmental impact important to you? Do you frequently carry several passengers? Do you want a used car or a new one?

Answer those questions and review ratings for vehicles that best suit your budget and lifestyle before visiting a Dallas car dealer. In addition to questions about the car, you also need to consider your financial needs and preferences.

Do not buy on impulse, said Rosa Johnson, Air Force FCU corporate trainer. Determine your budget and how a car will affect it. Consider insurance, gas and maintenance costs.

4. Apply for a Dallas Auto Loan and Get Pre-Approval

Auto loan terms and interest rates can vary widely depending on which lender you choose. For example, some dealerships try to convince buyers to spend more than they can afford by offering seemingly sweet dealer-arranged loans. However, the truth is that these loans often have higher interest rates after the first few years and can include hidden fees in the fine print.

In many cases, car buyers can find better deals through credit unions like Air Force FCU, which currently offers auto loans with rates from 1.49% APR for used car loans of up to 36 months and new car loans of up to 72 months. Air Force FCU members can apply in person, by phone or online to be preapproved for a loan.

Research your financing and prequalify for your loan, said Johnson. Dispute any inaccurate information on your credit report before applying for a loan.

Johnson also recommended applying for the loan within 30 to 60 days before you plan to start shopping for your car. Not only does getting preapproved provide you with peace of mind, but it also gives you a bargaining chip to enter negotiations because you know exactly how much you can afford to spend on a car, whereas the dealer does not.

Shop for low interest rates and never settle for the first offer, said Johnson.

5. Research Vehicle Prices Online

Its smart to use the internet to comparison shop before you set foot in a Dallas auto sales showroom. Research the range of features offered by different vehicles and compare the prices of similar cars and extras. Tools such as Kelley Blue Book can provide a solid idea of what you should pay for the cars on your list.

Along with visiting dealers online, auto shoppers should ask for recommendations from family and friends. Although many buyers are attracted to dealerships offering promotions, such as cash back rebates, its important to do the math to ensure you are in fact getting a good deal. Although a cash back bonus might be tantalizing, if salespeople aren’t willing to negotiate on price and other factors, the deal might be a dud.

6. Shop for Your Vehicle

Before purchasing a car, you should visit car lots and test drive a few of your top options. After you’ve settled on a make and model, look for the same car at different Dallas dealerships.

“Shoppers should always cross-shop dealerships of the same brand in their town,” said Brian Moody, site editor at Autotrader. “If you know you want a Ford Fusion, be sure to ask two or three local Ford dealers for their best price and give the other dealership a chance to beat it.”

7. Negotiate the Price of the Vehicle

Use your online research to show dealerships you’ve done your homework. After all, a dealer is unlikely to negotiate with you if your desired price ranges for particular cars and features are completely unreasonable. Additionally, you should ask car dealers if they can match lower prices offered in the area.

As you research the price of the vehicle, you also should obtain the vehicles true market value, said Johnson. If trading in a vehicle, research your trade-in by using NADA.com. Additionally, youll want to check the manufacturers website for any rebates or recalls, which can come in handy when youre sealing the deal, according to Johnson. Use these numbers as a negotiation tool, she said.

After taking these steps, you should be in a good position to settle on an attractive price for a car in Dallas. Knowing your covered all your bases and got a great deal can make driving your new car even more enjoyable.

Related: 3 Things You Should Never Tell a Car Salesman

First-Time Home Buyer’s Guide To Making A Downpayment

by Shelton on February 29th, 2016

filed under Below Average Credit

First-Time Home Buyers Guide: Making A Downpayment

Buying Your First Home: The Down Payment

First-time home buyers face a few hurdles as compared to other types of buyers.

A first-time home buyer may less money saved for a downpayment; may have a collection of  student loans and other large debt; may be just starting a career; and may have less experience with the home-buying process.

A first-time home buyer may even be about to live on their own for the very first time.

According to the National Association of REALTORS®, first-time home buyers account for 1-in-3 homes sold nationwide. This is the lowest rate in close to 30 years.

Yet, with mortgage rates low and an abundance of low- and no-downpayment mortgages available from mortgage lenders, theres never been a simpler time to get approved for your very first home loan.

This post discusses down payments; and, is the first of a four-part series meant to help first-time home buyers buy their first home and get approved for their first mortgage.

Click to see todays rates (Feb 28th, 2016)
What Does It Mean To Make A Downpayment?

When you buy a home, you have the option of paying for it with cash from your bank account; or, with money youve borrowed from a bank.

Sometimes, a bank will lend you the entire amount you need to buy a home. This is known as 100% financing.

However, you may not want to borrow 100% of a homes purchase price, or the bank may not allow it. The monies you pay from your own bank account is known as your downpayment.

As an illustration, if you purchased a home for $100,000 and wanted to make a ten percent downpayment, at closing, the bank would have $90,000 for you while the remaining $10,000 would be sourced from your savings.

As a home buyer, the size of your downpayment is up to you.

You can make a downpayment of twenty percent or more, or you can skip the downpayment altogether. Each choice has its benefits.

For example, when you make a large downpayment, you borrow less money from your lender which reduces your monthly mortgage payment.

You may also get access to lower mortgage rates.

When you make a small downpayment, you get the benefit keeping cash in your savings account for lifes emergencies. It also means that you can buy a home today instead of waiting 8 years to save for a downpayment.

Click to see todays rates (Feb 28th, 2016)
How Much Downpayment Is Required To Buy A Home?

As a first-time home buyer, you have access to a wide range of mortgage loans and mortgage loans can be customized to meet a buyers needs.

The size of your downpayment is one such customization.

Your downpayment can be as large as you wish, or as small — so long as you make the minimum downpayment required by your lender.

The five most-common low- and no-downpayment mortgages used by first-time home buyers are the FHA loan, the VA loan, the USDA loan, the Conventional 97, and the HomeReady(TM) mortgage.

Each is described below.

The FHA Loan

FHA loans require a downpayment of 3.5% of a homes purchase price, at minimum.

FHA loans are common among first-time home buyers because the program allows for below-average credit scores and there are no special qualifications.

FHA mortgage approval standards are considered to be the most-friendly toward first-time buyers.

The VA Loan

VA loans are available to members of the US military and veterans of the Armed Services.

VA loans provide a 100% financing option, and VA mortgage rates are often the lowest as compared to other low- and no-downpayment mortgage loans.

The USDA Loan

USDA loans also allow for 100% financing. The program is available for homes in rural areas and less-dense suburban neighborhoods nationwide.

USDA mortgage rates are often as low as VA mortgage rates.

The Conventional 97

The Conventional 97 is a 3% downpayment program available to home buyers with above-average credit scores. The Conventional 97 loan allows buyers to receive cash gifts for their downpayment.

The program has a loan size limit of $417,000.

The HomeReady(TM) Mortgage

The HomeReady(TM) mortgage is another 3% downpayment program. The program is geared at multi-generational households, but all home buyers are welcome to apply.

Home buyers using HomeReady(TM) get access to discounted mortgage rates and can use the income of boarders and other household residents to help get mortgage-qualified.

Click to see todays rates (Feb 28th, 2016)
Downpayment Assistance Programs Can Help, Too

First-time home buyers often cite making a downpayment as a primary obstacle to homeownership.

However, in addition to an abundance of low- and no-downpayment mortgages, first-time buyers have access to downpayment assistance programs (DPAs) — many of which grant money instead of requiring repayment.

And the programs are widely-available, too.

According to a study from housing data company RealtyTrac, there are 78 million single-family homes in the United States, including condominiums. 68 million — or 87% — of these homes potentially qualify for downpayment assistance.

As a first-time buyer, therefore, you can use downpayment assistance programs to help reduce your cash required at closing; and, to reduce your monthly mortgage payment.

Strangely, less than ten percent of home buyers even apply for downpayment assistance.

Home buyers often dont apply for such programs because theyre unaware that the downpayment assistance programs exist, they dont believe theyll qualify, or they plain dont know where to get access.

To find out for which assistance programs you may be eligible, talk to your mortgage lender. Most banks have applications on-hand for downpayment assistance programs, or can point you to a website.

The average downpayment assistance amounts to $11,565.

What Are Todays Mortgage Rates?

With mortgage rates low and US rents rising, its an excellent time to consider homeownership. And, as a first-time buyer, you have lots of options.

Get todays live mortgage rates now. Your social security number is not required to get started, and all quotes come with access to your live mortgage credit scores.

Click to see todays rates (Feb 28th, 2016)

Moody’s Assigns Aa3 to Pendleton County, KY $6.7M Public Prop. Corp. First Mortgage Revenue Refunding Bonds

by Shelton on February 27th, 2016

filed under Below Average Credit

New York, February 03, 2016 — Issue: First Mortgage Revenue Refunding Bonds, Series 2016 (Court Facilities Project); Rating: Aa3; Sale Amount: $6,675,000; Expected Sale Date: 2/4/2016; Rating Description: Lease Rental: Appropriation

Summary Rating Rationale

Moodys Investors Service has assigned a Aa3 rating to $6.7 million Pendleton County, Kentucky Public Properties Corporations First Mortgage Revenue Refunding Bonds Series 2016 (Court Facilities Project). The bonds are expected to price on or around February 4. The outlook is stable.

The rating is based on the credit quality of the Commonwealth of Kentucky (issuer rating of Aa2, stable), the subject-to-appropriation nature of the payments supporting the bonds, and the commonwealths significant reliance on appropriation-backed financings to fund capital investments. The rating also reflects Kentuckys record of proactive financial control and an economy that has benefitted from auto sector recovery. Low per-capita income levels, above-average state debt and large unfunded pension liabilities contribute to a below-average credit profile compared to most other states.

Rating Outlook

Kentuckys outlook is stable based on the expectation it will continue to manage its finances responsibly and work to improve the financing of teacher pensions, against a background of continued below-average state economic growth.

Factors that Could Lead to an Upgrade

Sustained economic and revenue growth, with structural balance in state finances and limited reliance on non-recurring resources

Build-up and maintenance of reserves

Significant reduction in adjusted net pension liabilities (ANPL)

Factors that Could Lead to a Downgrade

Sustained economic slowing, resulting in weaker revenue performance that strains commonwealth finances

Depletion of reserves with no replenishment, or indications of strained liquidity

Continued trend of negative GAAP basis ending balances, or continued reliance on non-recurring resources, particularly use of additional deficit financing, to balance the commonwealths budget

Failure to address large net pension liabilities

Legal Security

PAYMENTS FOR DEBT SERVICE PROVIDED UNDER BIENNIALLY RENEWABLE LEASE

The bonds are payable solely from lease rental payments from the commonwealths Administrative Office of the Courts under a lease agreement, as supplemented, with the corporation. Per the lease, AOC is obligated to make rental payments, including payment of a Use Allowance equal to debt service and an Operating Costs Allowance payment to cover operating costs.

AOC is obligated to make semi-annual rental payments of the Use Allowance directly to the trustee two business days prior to the debt service payment due dates. The Operating Costs Allowance payment is made to the county. Rental payments are made pursuant to the terms of the lease agreement, which is automatically renewable for successive biennial periods unless terminated in writing by AOC.

AOC covenants in the lease to seek sufficient legislative appropriations to make rental payments for each biennial period. The General Assembly has no obligation to make appropriations for rental payments, and AOC has no obligation to renew the lease. Under the Mortgage Deed of Trust, a foreclosable first mortgage lien on the project has been granted to the trustee. In addition, the interests of the corporation in the lease (excluding the Operating Costs Allowance) have been assigned to the trustee. In the event of a default on the bonds, the trustee may sell or re-let the facility to benefit bondholders. The lease may be amended to reduce AOCs use of the facility and, correspondingly, reduce its required rental payments. Any such amendment, however, would be contingent on the countys assumption of the reduced portion and confirmation by Moodys that the outstanding rating on the bonds would not be withdrawn or downgraded as a result of the amendment.

LEASE PERMITS ABATEMENT, RENTAL CREDITS

Should the project be destroyed or damaged such that it is rendered unusable by AOC, rental payments may be abated until AOC regains use of the project. As protection against such an event, rental interruption insurance sufficient to cover twenty-four months of debt service is required per the lease. In addition, the lease provides for an assessment of whether or not the project could be sufficiently renovated in twenty-four months. If the project cannot be repaired within twenty-four months of the date of damage to the point that it is sufficiently of use to AOC that AOC will make rental payments, insurance proceeds will be used to discharge the bonds. Per the lease, casualty insurance is provided at full replacement value of the project. Certain rental credits are permitted if AOC incurs operating costs in performing maintenance or other functions that are the obligation of the county under the lease. These credits, however, may only be taken against the Operating Costs Allowance, which AOC pays to the county for operating costs.

Use of Proceeds

The bonds are being issued to advance refund the Pendleton County, Kentucky Public Properties Corporation outstanding First Mortgage Revenue Bonds (Court Facilities Project), Series 2008. The refunding plan is being undertaken to provide interest cost savings to the county and the AOC.

Obligor Profile

The Commonwealth of Kentucky has a population of 4.4 million people and a gross state product of $150 billion. It has a large and diverse economy, but relatively low wealth levels.

The commonwealth has a four-tiered court system called the Court of Justice that includes the Supreme Court, the Court of Appeals, circuit courts and district courts. The Administrative Office of the Courts (AOC) serves as the staff for the Court of Justice, administered by the Commonwealths Chief Justice of the Supreme Court. AOCs duties include, among other things, providing offices and court space for the entire court system and dispersing and maintaining supplies and equipment. The Court of Justice is funded through appropriations from

Kentuckys General Assembly and represents approximately 3% of the total General Fund.

Pendleton County, Kentucky Public Properties Corporation is a nonprofit, non-stock public and governmental corporation organized and existing under the law of the Commonwealth. The corporations principal purpose is to act as an agency and instrumentality of the county in the planning, promotion, development, financing and acquisition by the corporation for and on behalf of the county of public improvements and public projects for the county.

Methodology

The principal methodology used in this rating was The Fundamentals of Credit Analysis for Lease-Backed Municipal Obligations published in December 2011. Please see the Ratings Methodologies page on www.moodys.com for a copy of this methodology.

Regulatory Disclosures

For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moodys rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support providers credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moodys legal entity that has issued
the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com
for additional regulatory disclosures for each credit rating.

Anne Cosgrove
Lead Analyst
State Ratings
Moodys Investors Service, Inc.
7 World Trade Center
250 Greenwich Street
New York 10007
US
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Emily Raimes
Additional Contact
State Ratings
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Releasing Office:
Moodys Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
USA
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Moodys Assigns Aa3 to Pendleton County, KY $6.7M Public Prop. Corp. First Mortgage Revenue Refunding Bonds

Moody’s assigns Aa3 to Kentucky’s $9.1M first mortgage revenue refunding bonds …

by Shelton on December 31st, 2015

filed under Below Average Credit

Kentucky has $7.9B of lease-appropriation debt outstanding

New York, December 09, 2015 —

Moodys Rating

Issue: First Mortgage Revenue Refunding Bonds, Series 2016
(Justice Center Project); Rating: Aa3; Sale Amount:
$9,080,000; Expected Sale Date: 12/16/2015;
Rating Description: Lease Rental: Appropriation

Opinion

Moodys Investors Service has assigned a Aa3 rating to $9.1
million Grant County, Kentucky Public Properties Corporations first
mortgage revenue refunding bonds (Justice Center Project) Series 2016.
The bonds are expected to price on or around December 16.

SUMMARY RATING RATIONALE

The rating is based on the credit quality of the Commonwealth of Kentucky
(issuer rating of Aa2, stable), the subject-to-appropriation
nature of the payments supporting the bonds, and the commonwealths
significant reliance on appropriation-backed financings to fund
capital investments.

The rating also reflects Kentuckys record of proactive financial control
and an economy that has benefitted from auto sector recovery. Low
per-capita income levels, above-average state debt
and very large unfunded pension liabilities contribute to a below-average
credit profile compared to most other states.

OUTLOOK

Kentuckys outlook is stable based on the expectation it will continue
to manage its finances responsibly and work to improve the financing of
teacher pensions, against a background of continued below-average
state economic growth.

WHAT COULD MAKE THE RATING GO UP

-Sustained economic and revenue growth, with structural balance
in state finances and limited reliance on non-recurring resources

-Build-up and maintenance of reserves

-Significant improvement in pension funding levels

WHAT COULD MAKE THE RATING GO DOWN

-Sustained economic slowing, resulting in weaker revenue
performance that strains commonwealth finances

-Depletion of reserves with no replenishment, or indications
of strained liquidity

-Continued trend of negative GAAP basis ending balances,
or continued reliance on non-recurring resources, particularly
use of additional deficit financing, to balance the commonwealths
budget

-Failure to address declining pension system funded levels

OBLIGOR PROFILE

The Commonwealth of Kentucky has a population of 4.4 million people
and a gross state product of $150 billion. It has a large
and diverse economy, but relatively low wealth levels.

The commonwealth has a four-tiered court system called the Court
of Justice that includes the Supreme Court, the Court of Appeals,
circuit courts and district courts. The Administrative Office of
the Courts (AOC) serves as the staff for the Court of Justice, administered
by the Commonwealths Chief Justice of the Supreme Court. AOCs
duties include, among other things, providing offices and
court space for the entire court system and dispersing and maintaining
supplies and equipment. The Court of Justice is funded through
appropriations from Kentuckys General Assembly and represents approximately
3% of the total General Fund.

Grant County, Kentucky Public Properties Corporation is a nonprofit,
non-stock public and governmental corporation organized and existing
under the law of the Commonwealth. The corporations principal
purpose is to act as an agency and instrumentality of the county in the
planning, promotion, development, financing and acquisition
by the corporation for and on behalf of the county of public improvements
and public projects for the county.

LEGAL SECURITY

PAYMENTS FOR DEBT SERVICE PROVIDED UNDER BIENNIALLY RENEWABLE LEASE

The bonds are payable solely from lease rental payments from the commonwealths
Administrative Office of the Courts under a lease agreement, as
supplemented, with the corporation. Per the lease,
AOC is obligated to make rental payments, including payment of a
Use Allowance equal to debt service and an Operating Costs Allowance
payment to cover operating costs.

AOC is obligated to make semi-annual rental payments of the Use
Allowance directly to the trustee two business days prior to the debt
service payment due dates. The Operating Costs Allowance payment
is made to the county. Rental payments are made pursuant to the
terms of the lease agreement, which is automatically renewable for
successive biennial periods unless terminated in writing by AOC.

AOC covenants in the lease to seek sufficient legislative appropriations
to make rental payments for each biennial period. The General Assembly
has no obligation to make appropriations for rental payments, and
AOC has no obligation to renew the lease. Under the Mortgage Deed
of Trust, a foreclosable first mortgage lien on the project has
been granted to the trustee. In addition, the interests of
the corporation in the lease (excluding the Operating Costs Allowance)
have been assigned to the trustee. In the event of a default on
the bonds, the trustee may sell or re-let the facility to
benefit bondholders.

The lease may be amended to reduce AOCs use of the facility and,
correspondingly, reduce its required rental payments. Any
such amendment, however, would be contingent on the countys
assumption of the reduced portion and confirmation by Moodys that the
outstanding rating on the bonds would not be withdrawn or downgraded as
a result of the amendment.

LEASE PERMITS ABATEMENT, RENTAL CREDITS

Should the project be destroyed or damaged such that it is rendered unusable
by AOC, rental payments may be abated until AOC regains use of the
project. As protection against such an event, rental interruption
insurance sufficient to cover twenty-four months of debt service
is required per the lease. In addition, the lease provides
for an assessment of whether or not the project could be sufficiently
renovated in twenty-four months. If the project cannot be
repaired within twenty-four months of the date of damage to the
point that it is sufficiently of use to AOC that AOC will make rental
payments, insurance proceeds will be used to discharge the bonds.
Per the lease, casualty insurance is provided at full replacement
value of the project.

Certain rental credits are permitted if AOC incurs operating costs in
performing maintenance or other functions that are the obligation of the
county under the lease. These credits, however, may
only be taken against the Operating Costs Allowance, which AOC pays
to the county for operating costs.

USE OF PROCEEDS

The bonds are being issued to advance refund the Grant County, Kentucky
Public Properties Corporation first mortgage revenue bonds (Justice Center
Project) Series 2007. The refunding plan is being undertaken to
provide interest cost savings to the county and the AOC.

RATING METHODOLOGY

The principal methodology used in this rating was The Fundamentals of
Credit Analysis for Lease-Backed Municipal Obligations published
in December 2011. Please see the Credit Policy page on www.moodys.com
for a copy of this methodology.

REGULATORY DISCLOSURES

For ratings issued on a program, series or category/class of debt,
this announcement provides certain regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moodys
rating practices. For ratings issued on a support provider,
this announcement provides certain regulatory disclosures in relation
to the rating action on the support provider and in relation to each particular
rating action for securities that derive their credit ratings from the
support providers credit rating. For provisional ratings,
this announcement provides certain regulatory disclosures in relation
to the provisional rating assigned, and in relation to a definitive
rating that may be assigned subsequent to the final issuance of the debt,
in each case where the transaction structure and terms have not changed
prior to the assignment of the definitive rating in a manner that would
have affected the rating. For further information please see the
ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

Regulatory disclosures contained in this press release apply to the credit
rating and, if applicable, the related rating outlook or rating
review.

Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moodys legal entity that has issued
the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com
for additional regulatory disclosures for each credit rating.

Anne Cosgrove
Vice President – Senior Analyst
Public Finance Group
Moodys Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
USA.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Emily Raimes
VP – Sr Credit Officer/Manager
Public Finance Group
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Releasing Office:
Moodys Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
USA.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Moodys assigns Aa3 to Kentuckys $9.1M first mortgage revenue refunding bonds (Justice Center Project), issued by Grant County, Kentucky Public Properties Corp.; outlook stable

In Case You Missed It, a Dramatic Shift Is Underway in the Credit Markets

by Shelton on December 17th, 2015

filed under Below Average Credit

Image source: Flickr user Bryan Rosengrant. 

The United States is very much a nation that runs on debt. From our federal government sporting an $18.2 trillion national debt to the average US household carrying $16,140 in credit card debt as of October 2015, access to credit and the prudent use of credit are critical factors that affect our consumption-dependent GDP.

A dramatic shift is underway in the credit markets
But whether you realize it or not, a massive shift in the credit markets is underway. Despite $77 billion in new credit lines being opened in the first quarter of 2015, a jump of $6 billion from Q1 2014, the average new credit card limit per account is lower across the board according to a Credit.com report that used data from Experian.

Consumers who are highly coveted by credit issuers tended to see a minimal decrease in average credit limit per new account. People in the super prime category (a FICO score of 781-850) witnessed just a 0.6% decline in their average new account credit limit to $9,543 in Q1 2015 from $9,604 in Q1 2014. Prime customers (FICO score 661-780) saw a 3.2% decline to $5,209 from $5,382.

However, average and below-average credit consumers witnessed credit issuers pull in the reins on a year-over-year basis. Near-prime (FICO score 601-660) average new account credit limits plunged 8.8% to $2,277, subprime (FICO score 500-600) consumers average new credit limits tumbled 17.5% to $966, and deep subprime (FICO score 300-499) consumers average new account limits were slashed by nearly 26% to just $509.

This shift in the credit markets was also corroborated by Credit Karma using data supplied by TransUnion.

Graph by author. X-axis represents consumer credit score ranges. Data source: Credit Karma via TransUnion.

Note the differences between 2011 and 2015: 

Graph by author. X-axis represents consumer credit score ranges. Data source: Credit Karma via TransUnion.

As you can see from the two graphs above, credit limits between 2011 and 2015 are nearly down across the board — and this time its very noticeable even for super-prime and prime consumers. Consumers with scores above 801 witnessed their average new account credit limit fall from $12,175 in 2011 to just $9,606 by 2015. Perhaps the only anomaly in TransUnions data pertains to some near-prime and subprime consumers, which actually saw their average credit limits rise slightly when opening a new account.

What does this all mean?
What could this imply? Its tough to say at this point, but it would appear that lenders are once again worried about the health of the US economy. If the latter is in good shape, banks will normally look to expand lending, especially to those who are most trustworthy, such as prime and super-prime consumers. Although banks opened more in new credit in Q1 2015 than in the prior year, the simple fact that average new account lending limits are falling is a possible sign that banks are genuinely worried about the economy and the health of the consumer.

Data from the Federal Reserve Board of Governors could help substantiate banks fears (if this is indeed why banks curbed lending limits in Q1). As of the end of the second quarter, the delinquency rate on credit card loans for all commercial banks totaled 2.1%, the lowest level on record going back to 1991. In fact, credit card delinquency rates have now dropped in 24 straight quarters, which is great news for the nations banks since it means theyve been having to set aside less for loan loss reserves.

Gray vertical areas represent periods of recession. Image source: St. Louis Federal Reserve. 

The quarter-over-quarter decline in delinquency rates from Q1 2015 to Q2 2015, however, was just a single basis point (2.11% to 2.10%). All prior sequential quarterly credit card loan delinquency declines had been for a minimum of four basis points (and often were much larger). In other words, the decline is flattening out, much like it did in late 1994 before delinquency rates rose by nearly 50% to a temporary peak of 4.78% in the fourth quarter of 1997.

Theres little denying that current credit delinquency rates are well below their historic averages, and I dont believe it would be crazy to assume that they might normalize in the coming years. Rising delinquency rates would likely cause banks to boost their loan loss reserves, ultimately hurting profitability.

This upturn in delinquencies rates may already be underway based on reported third-quarter results from some of the nations biggest credit card issuers. Capital One Financial reported in October that its 30-plus day delinquency rate rose to 2.95% from 2.65% in the sequential second quarter and 2.58% in Q1 2015. American Express also recorded a net write-off rate of 1.9% in its US card operations in for the third quarter, which is up from the 1.7% net write-off rate it logged in Q3 2014. However, not every bank saw a degradation in credit quality — albeit a decline in Capital One and AmEx, two notable credit card issuers, should merit some attention.

At this point, I dont believe it would be prudent to assume the gravy train for credit lenders has completely left the station, but as an investor, I would certainly suggest monitoring delinquency rates and new credit limits closely as the two are intricately tied at the hip. Tighter credit markets may not be terrible news for the US economy as a whole, but it likely wouldnt bode well for banks.

The Effect Of A 680 FICO Score On Your Mortgage

by Shelton on December 13th, 2015

filed under Below Average Credit

The Effect Of A 680 FICO Score On Your Mortgage

The Value Of Having Great Credit

Since 2013, mortgage rates have held near four percent, boosting the “amount of home” a home buyer can purchase; and the increasing the monthly savings available via a home loan refinance.

Against historical averages, mortgage rates are incredibly cheap. However, not everyone is getting access to the same low rates.

For borrowers with conventional loans — loans backed by Fannie Mae and Freddie Mac — the ability to access the “best mortgage rates” is directly linked to credit score.

The higher your credit score, the lower your mortgage rate. This is not news, though. Internet advertisements promising “credit score repair” tout the credit score-mortgage rate connection liberally.

However, what you may not have known, is that having a decent score gets you access to lower rates and expands the options available to you as a borrower.

With low credit scores, important loan programs can be unavailable or cost-ineffective — especially for borrowers using low downpayment loans.

Borrowers with high credit scores get access to a wider mix of solutions.

Click to see todays rates (Dec 13th, 2015)

Prime Mortgage Rates For Prime Mortgage Borrowers

You don’t have to go far on the internet or in the papers to see “today’s mortgage rates” — they’re advertised everywhere. You’ve probably seen them a few times today already.

What’s not always clear, though, is to whom those mortgage rates are available. The short answer is: Not everyone.

In general, the mortgage rates shown in an advertisement are geared at prime mortgage borrowers using conventional mortgage financing, where a “prime mortgage borrower” is one with high credit scores and ample income and assets to support a home loan approval.

Prime mortgage borrowers also make a down payment of 20% or more on their purchase of a 1-unit home, with the home being established as their primary residence.

Because of this definition, many mortgage applicants are not prime borrowers, including borrowers using FHA loans with 3.5% down and VA loans with 100% financing (who often get better rates anyway); and, otherwise “great borrowers” who are looking to do a mortgage refinance.

Sometimes, the interest rate differential is stark, registering one percentage point or more.

Click to see todays rates (Dec 13th, 2015)

The Difference Between 740 FICO amp; 680 FICO

Conventional loan mortgage rates vary wildly based on a borrower’s credit score.

Prime mortgage borrowers get access to the “best and lowest mortgage rates” you see advertised online and in print.

Everyone else gets access to something different.

Consider this illustration of two home buyers purchasing identical, neighboring homes at a price of $360,000. Both buyers plan to make the home their primary residence and both plan to make a 20 percent downpayment.

The buyers are identical is all respects except: One buyer’s credit score is 740 and the other buyer’s credit score is 680.

When the buyers apply for their respective home loans, one is categorized as a “prime” borrower and the other is not.

The prime borrower, whose FICO score is 740, is quoted a mortgage rate near 3.75% with zero points. The APR quote is similarly low, yielding a monthly principal + interest payment of $1,390.

The other borrower, meanwhile, whose FICO score is 680, is quoted a rate of 4.25% with zero points. And, although still low in the context of history, the elevated rate reflects the bank’s augmented risk.

The higher mortgage rate increases the borrower’s monthly mortgage payment by $86 versus his neighbor.

Over 30 years, this $86, which is paid monthly, yields $31,000 in “extra mortgage payments” as a result of having slightly banged-up credit as of the date of purchase.

$31,000 is more than 10% of the original amount borrowed!

Click to see todays rates (Dec 13th, 2015)

Prime Borrowers Get The Conventional 97, 80/10/10

With high credit scores, you get access to lower conventional mortgage rates. Good FICOs also get you access to loan programs which would otherwise be unavailable.

Take the Conventional 97, for example.

The Conventional 97 mortgage is a loan program available via Fannie Mae. It allows for a downpayment of just 3% and, unlike the FHAs low-downpayment mortgage option, the Conventional 97 requires no upfront mortgage insurance premium.

However, to use the Conventional 97, you must have a credit score of 680 or higher, which is right near the national average.

Borrowers with below-average credit scores, then, cannot use the Conventional 97.

They cannot use another low-downpayment mortgage option, either — the 80/10/10.

Often called a Piggyback Loan, the 80/10/10 program is comprised of a first lien (ie mortgage) for 80% of a homes purchase price; a second lien, which is typically a HELOC, for 10% of the purchase price; and a ten percent downpayment.

HELOCs typically require a FICO score of 680 or higher. Borrowers without a 680 FICO, then, cannot access to the 80/10/10 program because they cannot get approved for the 10 portion of the loan.

Note: Plenty of loan programs remain available to borrowers with less-than-perfect credit — just not all of them. The higher your scores, the more options youll have.

What Are Todays Mortgage Rates?

Todays mortgage rates are low. And, theyre even lower for borrowers who can be considered prime. Shop for the best, low rates and see for what youll qualify.

Get todays live mortgage rates now. Your social security number is not required to get started, and all quotes come with access to your live mortgage credit scores.

Click to see todays rates (Dec 13th, 2015)

More consumers approved for car loans

by Shelton on November 28th, 2015

filed under Below Average Credit

  • Email
  • Consumers are getting approved for car loans in larger numbers than ever since the recession, according to Experian Automotives most recent State of the Automotive Finance Market report.

    The group found that auto loans reached their highest levels, $968 billion, in the 3rd quarter of 2015, a growth of more than 53% since their low in 2010 and a $98 billion increase over the previous year.

    Continued growth in the automotive finance market is a clear sign of improved consumer confidence over the past few years, said Melinda Zabritski, Experians senior director of automotive finance, in a news release.

    Super prime consumers get a bump

    The largest increase in new auto loans went to those buyers with the best credit scores, so-called super prime consumers, increasing 8.3% over last year.

    If youre thinking of shopping for a car, first check your credit score for free at myBankrate.

    Do you have a thin credit file?

    There also was good news for consumers with below average credit scores. Those in the subprime and nonprime categories experienced increases of 7.8% and 7.7%, respectively, showing its getting easier to obtain car loans.

    Consumers who were late on their car payments also declined in the 3rd quarter of 2015. Delinquencies of 30 days dropped from 2.7% to 2.5% compared to the same time period a year earlier, while 60-day delinquencies dropped slightly from 0.74% to 0.73%.

    Before you buy, fix your credit before seeking a car loan.

    Tara Baukus Mello writes the cars blog as well as the weekly Driving for Dollars column, providing both practical financial advice for consumers as well as insight into the latest developments in the automotive world. Follow her on Facebook here or on Twitter  @SheDrives.

    As First-Time Buyers Flood Market, Home Supplies Get Scarce

    by Shelton on July 18th, 2015

    filed under Below Average Credit

    As First-Time Buyers Flood Market, Home Supplies Get Scarce

    Current Mortgage Rates Stoke US Home Sales

    With current mortgage rates hovering near 4 percent, US home sales remain strong.

    In May, despite a scarce supply of homes for sale, existing home sales tallied 5.35 million — a 22-month best.

    Also, purchasing power is soaring. the typical prime buyer can afford 10% more home as compared one year ago. This means that a home buyer whose maximum purchase price was $400,000 in 2014 can now purchase at $440,000 for the same monthly payment.

    Mortgage interest rates been at or below four percent since November of last year.

    Meanwhile, while mortgage rates drop, its becoming harder to find a good deal in housing. Demand for homes continues to outpace supply and values are ratcheting higher in many US markets.

    Thankfully, low- and no-downpayment mortgages remain readily available.

    Fannie Mae and Freddie Mac have re-launched a program allowing for just 3% down; and the Federal Housing Administration insures high-LTV loans for buyers with credit scores of at least 580.

    Click to see todays mortgage rates.

    Existing Home Supply Still Tight In 2015

    The National Association of REALTORS® recently released its May 2015 Existing Home Sales report, which showed 5.35 million homes sold on a seasonally-adjusted, annualized basis. The reading marks a five percent increase from the month prior, and a 9 percent increase from one year ago.

    Home supplies remain constricted nationwide.

    Buoyed by low mortgage rates and widely-available credit, home buyers are purchasing properties faster than sellers can list them.

    In May, 45% of homes sold in 30 days or fewer.

    Todays demand for homes is coming from first-time and repeat buyers. Just 14 percent of last months transaction can be attributed to real estate investors — a two-point decrease as compared to one year ago whereas first-time buyers now account for 32 percent of all homes sold.

    The percentage of repeat home buyers is increasing, too. A repeat buyer is a buyer who has owned a home within the last three years.

    Many times, repeat buyers purchase homes which are more expensive than their current ones.

    Repeat buyers are among the reasons why the typical US home sale price has climbed — todays buyers are moving up toward higher-priced homes, and away from lower-priced ones.

    Note how sales volume has changed at each NAR-tracked price range — especially for jumbo homes.

    • Home sales between $0-100,000 : -14% since last year
    • Home sales between $100,000-$250,000 : +4% since last year
    • Home sales between $250,000-$500,000 : +17% since last year
    • Home sales between $500,000-$750,000 : +15% since last year
    • Home sales between $750,000-$1,000,000 : +13% since last year
    • Home sales over $1,000,000 : +8% since last year

    It should be noted that the May Existing Home Sales report came in in-line with projections based on a different NAR publication — the Pending Home Sales Index.

    The Pending Home Sales Index measures the number of US homes under contract, but not yet closed. 80% of homes under contract close within 60 days, so there exists a very high correlation between the Pending Home Sales Index and the monthly Existing Home Sales report.

    The most recent Pending Home Sales Index data projected May home resales to near 5.33 million on an annualized basis. The actual home sales tally was right on target.

    Click to get todays mortgage rates now. 

    Buying Homes With Low Or No Downpayment 

    For todays active buyers, there are fewer homes for sale.

    According to the Existing Home Sales report, the national home supply sits at just 5.2 months. This means that, at the current pace of sales, the entire stock of 2.29 million US homes for sale would be sold in less than 6 months.

    This is a meaningful data point because home supply of 6 months or less connotes a Sellers Market; one in which home sellers have negotiation leverage over buyers and in which demand for homes is high.

    Existing Home Supply has been in such bull-market territory since August 2012.

    The good news is that todays home buyers are able to finance their purchases via a growing number of mortgage programs, including low-downpayment loans, no downpayment loans, and loans for luxury homes.

    Among the most popular options with todays low-downpayment buyers is the FHA loan. FHA loans require just 3.5% down and offer flexible mortgage approval terms, including an allowance for average and below-average credit scores.

    Another common low-downpayment option is the conventional 97% program. This government-backed loan tends to work well for buyers with above-average credit scores who are buying single-family, detached properties (ie not condos or town homes).

    Only 3% down is required and buyers can receive cash downpayment gifts.

    For buyers in rural and suburban areas, the USDA loan is an excellent no-downpayment option.

    This zero-down loan is backed by the US Department of Agriculture and can provide below-market mortgage rates to applicants who use it.

    Lastly, as the mortgage market has loosened, so have requirements for the fixed-rate and adjustable-rate jumbo mortgages.

    Many banks now require just 10% down for a jumbo loan; and have lowered their minimum credit score requirement. This has helped spur the luxury housing market forward and is one reason why home sales over $750,000 continue to make gains.

    Get A Complimentary Mortgage Rate Quote 

    Buoyed by low mortgage rates, the US housing market is advancing. Home sales are rising and so are home values. Its an excellent time to consider your options as a buyer; and to plan for your future as a homeowner.

    Get a complimentary mortgage rate quote now. Rates are available at no cost, with no social security number required to get started, and with no obligation to proceed whatsoever.

    Click here to get started.

    Using The VA Interest Rate Reduction Refinance Loan – VA Streamline Refinance

    by Shelton on July 15th, 2015

    filed under Below Average Credit

    Using The VA Interest Rate Reduction Refinance Loan VA Streamline Refinance

    Use The VA IRRRL Mortgage Loan

    For homeowners with an existing VA mortgage, the VA Interest Rate Reduction Refinance Loan (IRRRL) can be an excellent way to lower your mortgage rate with only limited paperwork and documentation.

    Sometimes known as a VA Streamline Refinance, the IRRRL program waives the typical verifications of a refinance including lender checks of credit, income, and employment.

    Instead, the program relies a homeowners payment history to gauge credit-worthiness. 

    If youve paid your mortgage on-time for the last 12 months, and youre going  mortgage rate is reducing, its likely youll qualify for the VA IRRRL.

    And, because VA mortgage rates are typically 30 basis points (0.30%) below rates for a comparable conventional loan, reducing your rate may be simpler than you expect.

    Todays VA mortgage rates are near their lowest levels in history.

    Click to get a VA rate quote now.

    What Is A VA Loan?

    The VA Interest Rate Reduction Refinance Loan (IRRRL) is a program available to homeowners with existing VA home loans. The VA refinance loan can be used on a primary or second residence; or, on a vacation home if the homeowner can prove that the home was once a primary residence.

    VA loans are limited to military borrowers.

    The Department of Veterans Affairs defines military borrowers, in general, as borrowers who have served 181 days during peacetime, 90 days during wartime, or have spent 6 years in the Reserves or National Guard. 

    In addition, many surviving spouses of service members killed in the line of duty are VA loan-eligible, as are most all active duty and/or honorably discharged service members.

    VA loans require no money down, require no mortgage insurance, and allow borrowers with below-average credit scores to get approved. 

    Even better, VA mortgage rates are cheap as compared to FHA loans and conventional ones. Interest rates on a VA loan are often one-eighth of a percentage power lower than a comparable FHA loan; and up to three-eighths lower than a comparable conventional loan.

    Click for todays rates now.

    Qualifying For The VA IRRRL Loan

    The VA Interest Rate Reduction Refinance Loan (IRRRL) is a special benefit to homeowners with existing VA financing.

    Sometimes called the VA Streamline Refinance, the IRRRL program lets homeowners refinance to lower mortgage rates with very little hassle — often within 30 days from application.

    The IRRRLs eligibility criteria is as follows:

    • Your current mortgage must be a VA loan
    • You must be on-time with your mortgage for the last 12 months
    • You may not receive cash out as part of the refinance
    • You must certify that the home is your primary residence, or was

    And, lastly, after the refinance, your new mortgage payment must be lower than your current monthly payment. There is one exception to this rule, however.

    If youre refinancing an ARM into a fixed-rate loan, your payment is not required to reduce.

    Beyond that, there are very few steps in the mortgage approval process. According to the official VA loan guaranty guidelines, with a VA Streamline Refinance, lenders are not required to perform credit score verifications, income documentation verification, or employment checks.

    In addition, with a VA loan refinance, home appraisals are not required. Therefore, regardless of your homes value, you can be eligible to use the IRRRL program.

    Apply for a VA refinance with any US mortgage lender.

    Get Todays Live Mortgage Rates

    The VA IRRRL is among the simplest, fastest ways to refinance a US home loan. If you have an existing VA loan, then, consider todays mortgage rates and your ability to refinance to a lower rates and payment.

    No-obligation, no-cost mortgage rates are available online with no social security number required to get started at all.

    Click to get a rate quote now.