Why FHA Streamline Refinance Is Such A Flexible Option

One of the major benefits of refinancing your FHA loan today is reduced mortgage insurance rate premiums (MIP). As of January 26th 2015 mortgage insurance rates have been reduced drastically from all time highs to a level not seen in years.

With this announcement all new FHA Refinance loans are now eligible for lower mortgage insurance premiums. Now is an excellent time to consider an FHA streamline refinance loan for a lower interest rate and MIP payments since the savings have improved.

One interesting area of FHA Streamline refinance program is that you can earn an upfront Mortgage Insurance Premium (UFMIP) refund when you refinance within 36 months of closing, a portion of the upfront fee can be refunded. Refunds can range from 10-68% depending on how soon you refinance.

The new MIP rates apply to all FHA Refinance programs that are new loans in 2015.

fha streamline refinance

FHA Refinance Guidelines

 

  • Rate and Term Refinance
  • Must be your primary residence
  • FHA appraisal is required
  • Refinance up to 97.75% of value
  • Borrower must be qualified for the loan
  • No cash back at closing
  • FHA upfront Mortgage Insurance Premium refund possible

 

FHA Streamline Refinance

 

  • Primary, vacation, or investment property allowed
  • No income check required
  • 620 FICO score required
  • You can have streamline without appraisal
  • Fast turnaround time to close
  • No late payments in the past year on current FHA mortgage

The goal of the streamline program is to lower your total monthly mortgage payment including interest rate and monthly mortgage insurance. (Please note – the total finance charges may be higher over the life of your loan). The idea is to accomplish this with less documentation than required when you originally qualified for the FHA loan.

What about mortgage insurance?

When you received your original FHA loan you agreed to pay an upfront mortgage insurance premium that is a lump-sum payment which was financed into your loan. In addition to this you agreed to pay monthly mortgage insurance that is part of your total monthly mortgage payment.

  • If you current FHA loan was closed before May 31st 2009 you will be able to keep your current monthly mortgage insurance of .55% and it will be .01% for the upfront
  • If you current FHA loan was closed after May 31st 2009 you will be allowed to get the new lower monthly mortgage insurance of .80% and it will be 1.75% for the upfront

For more information about the FHA Streamline Refinance process and what you will need to get started have a look at the “Simple Steps to an FHA Loan” Guide book. Click the image to download

FHA Home Loan

Cash-Out Refinance

 

  • Must be your primary residence
  • FHA appraisal is required
  • 620 FICO score required
  • Borrower must be qualified for the loan
  • Upfront mortgage insurance premiumsrefund is available
  • Allowable closing costs can be financed into new loan
  • Cashout up to 85% LTV (Loan To Value)
  • No late payments in the past year on current FHA mortgage

 

What about mortgage insurance?

When you a cashout your FHA mortgage monthly mortgage insurance and upfront mortgage insurance will be required just like on your original FHA mortgage.

  • Your monthly mortgage insurance will be .80% and 1.75% for the upfront mortgage insurance

 

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