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Mortgage Originators realize that one loan product does not fit all. Several loan types exist and has had initial success but failed to perform as designed. The FHA insured loan has been a strong contender on the home buying, home-ownership front and is still performing. In 2004 FHA only counted for 4% of all home loans, in 2008 FHA insured $205 billion dollars of single family mortgages and in the first 6 months has insured an additional $158 billion in single family homes.
FHA is not the “Cure All”, or a panacea but it offers all the bells and whistles that secures the promotion of homeownership. Something about that statement is particularly appealing right now.
This will be a series that show off some of the greatest benefits of the FHA mortgage loan; the first loan I will cover is the FHA Streamline refinance.
FHA has permitted streamline refinances on FHA insured mortgages since the early 1980's. The
tremendous feature of the streamline it is a reduced documentation loan with no statement of
income or assets.
Some of the basics of a streamline refinance are:
1. The mortgage to be refinanced must already be FHA insured.
2. The mortgage to be refinanced should be current and not over 30 days delinquent more than once
in the last year.
3. The benefit of the refinance is to result in lowering your monthly principal and interest
payments.
4. No cash may be taken out on mortgages refinanced using the streamline process, however you may receive up to $500.
FHA Streamline can be done in one of two ways
1. Streamline Refinance with an Appraisal:
2. Streamline Refinance without an Appraisal:
Note: The Streamline without the appraisal you (may) be required to bring to closing due to the final calculation from your mortgage pay-off.
Investment property loan with FHA
Investment properties, even if originally acquired as principal residences by the current borrowers,
may only be refinanced for the outstanding principal balance. The term of the mortgage is the lesser
of 30 years or the remaining term of the mortgage plus 12 years.
Streamline refinances by investors or for secondary residences may only be made without an
appraisal and may be made solely in the business entity's name if previously insured in the business
entity's name.
The FHA Streamline loan is the only loan that does not care about bad credit, late payments on credit cards, charge offs, judgments, etc,.
Underwriting is only concerned with the performance of the FHA loan. If the loan is less than 12 months old, the prior non-FHA loan history is NOT taken into account no matter what that performance was.
Borrowers are able to receive up $500 back at closing.
Fixed-rate mortgages may be refinanced to a one-year ARM, with or without an appraisal, provided the interest rate of the new mortgage is at least 2 percentage points below the interest rate of the current mortgage.
An ARM may be refinanced to a fixed rate mortgage, with or without an appraisal, provided the interest rate on the new fixed-rate mortgage will be no greater than 2 percentage points above the current rate of the ARM.
An ARM may be refinanced to another ARM, provided that an immediate payment
reduction occurs and that the maximum interest rate of the new mortgage does not exceed
the maximum interest rate of the old mortgage being refinanced.
There is no Penalty:
You may prepay any or all of the outstanding indebtedness due under your mortgage at any time, without penalty.
That is the FHA Streamline demand for this product has greatly increased during this recession amongst current FHA holders that found them self cash strapped and with slow pays in this economy.
If you or anyone you know current has a FHA loan that is 90 days old or older and your rate is higher than the current national average.
Contact Me Immediately the FHA Streamline is your “CURE ALL”
Robert Summers
Originator
317-925-1877
or APPLY ONLINE
Stay tuned for the next FHA Article
Only lenders approved by FHA can take an application, process the information and close an FHA-insured loan for you.
The content is exclusively the personal opinion of the author. Under no circumstances should the content be attributed to any employer, past, present, or future, of the author, unless so stated explicitly by that individual or organization
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