March 21, 2022
Thinking about a refinance loan but not sure where to start? There are some common questions about refinancing your home loan, we provide some answers to them below from cash-out refinancing to rehabilitation loans.
When Can I Refinance My FHA Mortgage?
That may depend on the type of refinancing you seek. You can get an FHA Cash-Out Refinance loan once you have owned and occupied the property for 12 months.
For FHA Rate-And-Term Refinances, you can own the home for less than 12 months but the loan-to-value ratio will be lower than if you apply after having owned and occupied the home for more than 12 months. FHA Streamline Refinance options require you to own the home for at least six months.
Can I Refinance A Non-FHA Mortgage Into An FHA Loan?
FHA Cash-Out Refinancing and FHA No-Cash-Out Refinance loans are two options you can consider when it’s time to refinance a non-FHA mortgage.
You can refinance out of an adjustable-rate loan into an FHA Fixed-Rate Mortgage, or you can choose to refinance an adjustable-rate loan into another adjustable-rate mortgage if the lender agrees. One thing you cannot do is to use an FHA Streamline Refinance Loan with a non-FHA mortgage. Those are for FHA loans only.
Can I Get Cash Back When I Refinance?
In general, the only time you are allowed cash at closing time above $500 on an FHA refinance loan transaction is when you’re applying for FHA Cash-Out Refinance loans. You are allowed cash for specific purposes when you apply for FHA One-Time Close Construction Loans or for FHA 203(k) Rehabilitation loans, but those funds are strictly controlled and may only be used for approved purposes.
Can I Shop Around For An FHA Refinance Loan?
You are not required to use the same lender for the refinance loan as you did for the original. FHA loan rules make it clear that you can and should shop around for the best FHA refinance loan rates and terms. Not all lenders offer their loans with the same fees, terms, and conditions.
You may find a different lender offers perks your current one does not, or vice-versa. It’s smart to make the most informed choice about lenders possible.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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