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Articles Tagged With: FHA Refi

FHA Streamline Refinance Loans: Basics For Credit Qualifying Streamline Refinancing

In our last blog post we discussed some basics on FHA Streamline Refinance Loans. The FHA Streamline Refinance loan program permits lenders to process the loan paperwork for these refinances (FHA-to-FHA only) with no credit check in most cases. But lenders are free to require a credit check, and there are some cases where the credit check is required if add-ons to the loan cause the borrower’s monthly payments to increase by 20% or more, but there are other circumstances that may also require credit-qualifying. HUD 4155.1 states: “A credit qualifying streamline refinance must be considered: –when a change in the mortgage term will result in an increase in the mortgage payment of more than 20% –when deletion of a borrower or borrowers will trigger the due-on-sale clause –following the | more...

 

FHA Refinance Loan Maximum Mortgage Calculation

In recent posts we have discussed the maximum mortgage amount for FHA home loans. The borrower is required to make a minimum down payment on all new purchase FHA mortgage loans (3.5%) so that the maximum financing allowed would be 96.5%. Some borrowers may have to make larger down payments depending on credit scores and credit history. The FHA’s loan-to-value maximums can also be different depending on the type of transaction. With those ideas in mind, what are the FHA loan rules for refinance loans? For non-streamline, appraisal-required FHA refinance loans that feature no cash back to the borrower, FHA loan rules say the following: The maximum mortgage for a no cash out refinance with an appraisal (credit qualifying) is the lesser of the –97.75% Loan-To-Value (LTV) factor applied to | more...

 

FHA Refinance Loan Options

If you are considering a refinance loan, there are many options under the FHA single-family home loan refinance program. You can refinance from a conventional or non-FHA mortgage into an FHA loan, get out of a variable or adjustable rate mortgage into a fixed rate loan, and even refinance with added funds for approved energy-efficient features or upgrades. FHA home loans allow non-FHA borrowers to refinance using cash-out or no-cash-out refinancing. These types of refinance loans require a new appraisal and credit check. Borrowers should know that even if it’s only been a short amount of time since loan closing, any appraisal used on a home where the loan has closed cannot be re-used for the purpose of a new loan. Borrowers who want to refinance early should expect to | more...

 
When Is An FHA Loan Better Than A Conventional Loan?

FHA Streamline Refinance Loans

If you have an existing FHA mortgage loan, you can apply for a refinance loan with no FHA required credit check or appraisal that results in a reduction in your monthly mortgage payment and/or interest rate in most cases. Called the FHA Streamline Refinance loan, these loans are only for existing FHA mortgages and offer no cash back to the borrower. FHA loan rules permit Streamline loans for those who have assumed FHA mortgages. According to the FHA official site (www.fha.gov), the FHA, “does not require an appraisal on a streamline refinance. These transactions can be made with or without an appraisal.” If there is a lender required appraisal, there may be corrections noted. According to FHA loan rules, these corrections may or may not need to be made as | more...

 

FHA Home Loans And Divorce

We get plenty of reader questions about the practicality or feasibility of putting a home loan in one borrower’s name as part of divorce proceedings. Borrowers who purchased a home together with an FHA loan who later get divorced may or may not be at odds regarding who is to take responsibility for the home, the mortgage, and related financial obligations. We’re often asked if it’s possible to refinance so that one borrower or the other can take sole possession of the property and the mortgage. But divorce proceedings–and divorce law–often varies from state to state, so it’s impossible to answer such questions in a general way. Community property laws may dictate how such things must be carried out, and not all states have community property laws. So what can | more...

 

FHA Streamline Refinance Loans: Appraisal Required?

When you examine your streamline refinance options, it’s easy to get confused over the difference between lender requirements and FHA refinance loan standards. FHA Streamline Refinance Loans are intended for borrowers with existing FHA mortgages and can be done on any type of existing FHA loan–fixed rate, adjustable rate, graduated payment mortgage, etc. Some borrowers want to know if there is a new credit check or appraisal required. There is no short answer to this because while FHA loan rules do not demand a new appraisal, the lender may require one. The credit check issue also depends on a variety of circumstances including the type of refinance transaction (fixed rate to adjustable rate, for example) and how long the borrower has owned the property. FHA loan rule spell out some | more...

 

FHA Loans, Refinance Loans, and Missed Mortgage Payments

We get many reader questions about FHA refinance loans. Some of those questions involve what the lender might do if the borrower has missed mortgage payments leading up to the refinance. The short answer to these types of questions is that it depends on the type of refinance loan in question and the reason for the loan. All FHA refinance loans require the borrower to be current or to be brought current on the loan–that could mean in some foreclosure avoidance scenarios that the missed mortgage payments are added into the new loan amount. For borrowers who are not seeking foreclosure avoidance, but rather simply refinancing the property, there may be a 12 month seasoning period or mandatory waiting period which must elapse between the last missed payment and the | more...

 

FHA Refinance Loan Options: FHA-To-FHA, Non-FHA to FHA

Is now the right time to refinance your mortgage with an FHA loan? Many are considering their options, but if you don’t know the possibilities offered by an FHA refinance loan, now is a good time to get caught up on what’s available for owner-occupied single family home loans. FHA single-family home loan refinancing is available for both existing FHA loans and non-FHA mortgages. Your current loan can be an FHA, VA, conventional, or any other type of home loan that meets FHA program requirements for refinancing. Borrowers applying for any type of single family FHA home loan must be owner-occupiers of the property securing the new loan. For existing FHA loans, there is an option for cash-out (appraisal and new credit check required), no cash out (an appraisal and/or | more...

 

HUD Releases May Housing Scorecard

The FHA/HUD official site has issued its housing scorecard for May 2015, and the numbers could help some borrowers decide whether the time is right to consider a cash-out or no-cash out refinance loan. According to the official site, www.HUD.gov, “HUDs May Housing Scorecard details the recovery of our nations housing market. As we look back, we witnessed progress among key indicators, including a spike in new home sales, a high level of previously-owned home sales over the last two months, and gains in U.S. home values. While great progress is being made, we must continue to support programs that will allow more American families and homeowners to recover from the Great Recession.” That might not sound terribly exciting to a borrower considering an FHA refinance loan, but the housing | more...

 
What happens to my FHA loan in a natural disaster?

FHA Refinance Loan Facts

Are you thinking about refinancing a home loan? There are some facts about FHA refinancing loans you should know before you start shopping around for a lender. And that’s an activity more than one borrower doesn’t think about when first considering a refinance. Did you know you don’t have to stay with your original financial institution in order to refinance a mortgage? That’s our first tip about home loan refinancing: Shop Around For A Lender Your current lender may or may not offer you the most competitive refinance loan interest rates and/or terms. Do you know what other rates are offered elsewhere? You do not have to use the original lender to refinance a home loan with an FHA mortgage. You will need to find a participating FHA lender, but | more...