FHA refinance completed with nothing due at closing
Under the previous lender’s offer, this fha conventional loan amount would have been added to the new loan. Cabalsi also offered to roll any unpaid interest from the old loan into the new loan, and the borrower was happy to accept and reduce the amount of cash needed at closing. The borrower was also advised that they would have to deposit funds for a new impound account, which is required by FHA. However, this was not an issue because the money in their previous impound account was refunded after closing. Since FHA loans do not prorate interest charges for the month in which they are being paid off, Cabalsi ensured closing at the month’s end for optimal effect. The borrower paid nothing for the refinance, the work for the streamline was simple and convenient, and Cabalsi’s borrowers are now saving more than $300 on their total monthly payment.
Full original article: FHA streamline refinance comes with no expense to buyer
A Simple Refinance for FHA Mortgages
People who got an FHA loan around 2009 have more options for rate and costs when streamline refinancing,” he said. “With rates at historical lows, I haven’t had any borrower opt to pay points for a below-market rate in almost two years. In their gut, it doesn’t make sense to ‘pay in order to save.’ Well, that thinking can be taken a couple steps further.” When getting a market rate with 0 points, borrowers still have to pay the market fees associated with conducting a refinance transaction. Title, escrow, lender, notary and recording charges are all part of the closing fees, which can add up to a few thousand dollars. By offering an above-market interest rate, lenders can provide a lender credit to pay for these closing costs, which is what Cabalsi’s borrowers wanted to do. Furthermore, Cabalsi’s borrowers were interested in taking an even higher interest rate; that way, the lender credit could increase to pay for the impound account reserves required with FHA.
Full original article: FHA refinance completed with nothing due at closing
The New FHA Streamline Refinance
In fact, there’s no limit on how far underwater a borrower can be and still get an FHA Streamline Refinance. If you’re underwater due to a non-FHA second mortgage on top of your FHA home loan – for example, a home equity loan or home equity line of credit (HELOC) – you’ll need to pay off the balance on that loan before you can get an FHA streamlined refinance. You won’t be able to fold it into the new FHA mortgage. Theoretically, you might be able to get the second mortgage resubordinated to the new FHA loan, but that process is pretty much incompatible with a streamline refinance. Still the lender’s call Although the FHA has pretty generous guidelines for refinancing its own loans, it’s still the lender’s call on whether to refinance or not.
Full original article: The New FHA Streamline Refinance
<img src='http://ww3.hdnux.com/photos/15/12/33/3450574/3/628×471.jpg' width='200px' alt='Ty Cabalsi Photo: FHA Home Loan Programs Ty Cabalsi’ style=’float:left;padding:5px’ />
You can only add the upfront portion of the required mortgage insurance premium to the balance of your loan. So, the new loan balance cant exceed the current amount outstanding, plus the upfront portion of the mortgage insurance premium. Youll either have to pay the closing costs upfront in cash, or qualify with your lender for a zero-cost FHA Streamline refinance. Finally, the refinance must have a purpose that benefits the homeowner, such as significantly lowering monthly mortgage payments or moving from an adjustable-rate mortgage to a more stable fixed-rate mortgage. If lowering the monthly payment is the purpose, you must be able to demonstrate at least a 5 percent drop in your monthly mortgage payments, including the mortgage insurance premiums.
Full original article: A Simple Refinance for FHA Mortgages