June 5, 2015
FHA refinancing loans give borrowers many options. Did you know that you do not need to have an existing FHA mortgage loan to take advantage of certain FHA refinance options on your loan? You can change lenders, change the nature of your loan from an adjustable rate to a fixed rate, and add energy-efficient improvements to the loan amount.
FHA cash out refinance loans permit non-FHA borrowers to apply for refinance loans on conventional loans. You can refinance your existing FHA or non-FHA mortgage from a fixed rate to a new fixed rate loan, fixed rate to adjustable rate, adjustable rate to adjustable rate, etc.
Cash out refinance loans always require a new appraisal, even if your current appraisal is still current. FHA loan rules say you cannot use an appraisal on a loan that has closed in a new loan transaction. The appraisal fee is paid by the borrower.
If a borrower chooses to add FHA Energy Efficient Mortgage options to the loan, he or she will need to work with the lender to determine what types of improvements to the home are permitted under the program and how to determine the savings of those improvements.
Your lender will require calculations that show how the improvements would save the borrower money, though in some cases the installation of storm windows or other upgrades may have some kind of estimated savings that can work as a basic template. The installation of approved solar upgrades or other high-tech improvements may require more in-depth calculations depending on circumstances and the nature of the upgrades.
One thing potential FHA refinance loan applicants should know is that some types of FHA refinancing is only for existing FHA mortgages. This is true in the case of FHA Streamline Refinance loans–these FHA-to-FHA refinance loans do permit those with existing FHA mortgages to refinance whether that’s with the original lender or a new one.
FHA Streamline loans may not require a new credit check or appraisal, depending on the circumstances of the loan. Talk with your lender about your FHA mortgage loan options for Streamline refinancing.
Do you have questions about FHA refinance loans? Ask us in the comments section.
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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