Cash Out Refinancing with FHA Loans

Posted on October 29, 2008 by admin 
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FHA home loans have quickly become the mortgages of choice for cash out refinancing and new home purchase financing. Raising capital with a home mortgage was definitely easier in past years. As many consumers have found out the hard way, home equity loans have practically become extinct. Unless you have great credit and are able to provide full income documentation to the lending underwriter, you don’t have a shot to qualify for a conventional mortgage refinance.

Did I mention you also need to be less than 80% loan to value as well? Just last year no equity was required to get cash out when refinancing with a 1st or 2nd mortgage refinancing. After record breaking number of foreclosures every month, most lenders wised up and cut off the home equity loan product line.

In 2008, the thirty year fixed rate mortgage remains competitive and historically pretty low averaging in the mid six percent range all year. For the first time, FHA mortgage loans actually dropped below the conventional interest rate levels. FHA home loans typically carry a little bit of a higher rate because of the increased risk factor that goes along with no equity and lower credit score requirements. Read Complete FHA Refinance Article. – Article written By Sean Dornan

Is FHA Refinancing Doing All it Can to Stop Foreclosures?

Posted on October 28, 2008 by admin 
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HUD released new statistics elaborating on the 400,000 homeowners that refinanced with FHA mortgage loans during the past year. Let’s all congratulate HUD for getting as many people as possible into FHA home loans. The only problem is that such numbers do not exist in a vacuum. The core reason for more FHA financing is very simple: Private-money mortgages have disappeared. But the Housing of Urban Development is not telling the whole story when it says that in July of this year that “HUD expanded the FHASecure loans to help homeowners with adjustable rate subprime mortgages who can no longer afford their mortgage loans and missed up to three monthly mortgage payments over the past 12 months.

Rather than go into foreclosure, eligible borrowers can refinance with FHA and lenders can voluntarily write down the outstanding subprime mortgage principal balances.” The catch, of course, is that “eligible borrowers” have been rare. Figures from HUD show that 455,803 borrowers refinanced with FHA mortgages during fiscal 2008 — the period ending September 30th. During the same period only 3,794 delinquent conventional borrowers were able to refinance with FHA home mortgages.

Less than 1 percent of all FHA mortgage refinance loans bailed out failing borrowers. Does anyone believe that more distressed homeowners could have been helped had HUD relaxed eligibility requirements? Does anyone doubt there the need is there? Loan modifications soared in 2008 and most industry insiders believe that 2009 and 210 will be more of the same.

Choosing a FHA Mortgage Refinance

Posted on October 27, 2008 by admin 
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Homeowners enjoy many benefits of investing in their home year after year. For some, there comes a time when that investment can come in handy. Refinancing with an FHA mortgage loan can be an effective way to put that equity to work.

In the housing market, homeowners have multiple opportunities to invest in their property annually. An FHA mortgage loan can be an effective method to continue the investing. Some of the options that FHA home loan offers for mortgage refinancing on properties used as principal residences are as follows:

FHA CASH OUT REFINANCE

If a borrower bought their home quite some time ago and it has increased in market value refinancing is an excellent choice for homeowners. A Cash Out refinance will give the owners a chance to refinance their present mortgage by getting a larger home loan greater than they currently owe, which repays their current mortgage debt. This gives the homeowner equity access that has grown from their home and utilize it where needed.

In order to achieve the maximum benefits when refinancing your FHA loan, it is usually better to think of an FHA refinance after it has been determined that you have a significant amount of equity built in your home. If the property was purchased over one year prior to the purchase date, the property can be refinanced by up to 95 percent of the appraised value with the permitted closing fees, which will be different in various states.

FHA STREAMLINE REFINANCING INFO

The FHA streamline refinancing choice is termed as such due to the little paperwork required. This selection will allow you to decrease the interest rate on your present home loan fast and more often than not without an appraisal. It saves borrowers considerable time and money with features like:

o No Appraisal necessary

o No Credit underwriting

o No Qualifying Debt Ratios

o No Credit Check

o No Income Verification

o No In-Person Application

In order to be eligible for a FHA Streamlined Refinance your current mortgage loan has to be an FHA loan in good standing and the new loan must lower your monthly interest payments. This loan method of refinancing decreases your monthly expenses by reducing your home loan payments but there is not a choice to get cash back at closing. This is a great option for individuals who have a good financial status, no substantial debt because it saves you some extra money monthly that can be utilized toward something else.

In order to be eligible for a FHA Streamlined Refinance your current mortgage loan has to be an FHA loan in good standing and the new loan must lower your monthly interest payments. This loan method of refinancing decreases your monthly expenses by reducing your home loan payments but there is not a choice to get cash back at closing. This is a great option for individuals who have a good financial status, no substantial debt because it saves you some extra money monthly that can be utilized toward something else.

In order to be eligible for a FHA Streamlined Refinance your current mortgage loan has to be an FHA loan in good standing and the new loan must lower your monthly interest payments. This loan method of refinancing decreases your monthly expenses by reducing your home loan payments but there is not a choice to get cash back at closing. This is a great option for individuals who have a good financial status, no substantial debt because it saves you some extra money monthly that can be utilized toward something else.

In order to be eligible for a FHA Streamlined Refinance your current mortgage loan has to be an FHA loan in good standing and the new loan must lower your monthly interest payments. This loan method of refinancing decreases your monthly expenses by reducing your home loan payments but there is not a choice to get cash back at closing. This is a great option for individuals who have a good financial status, no substantial debt because it saves you some extra money monthly that can be utilized toward something else.

Frank Collins is an avid investor in real estate and contributor to FHA Home Loans and a website to Find Low Mortgage Rates and trusted lenders in your area. Article Source: http://EzineArticles.com/?expert=Frank_Collins

FHA Loan Products in Limbo

Posted on October 27, 2008 by admin 
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FHA still only offers home financing that only requires 3% down-payments. Clearly, Low down-payments and low rates make FHA enticing to first time homebuyers!  Limited or Poor Credit? No Equity…No Problem! You can find advertisements that feature FHA home loans and you can’t help but wonder, is FHA going to replace  sub-prime? If non-prime and Alt-A borrowers have no avenues for home loans, many experts believ these types of borrowers will to try to qualify with FHA loans. Now, they’re have been some changes to help avoid this route, but the key difference between FHA and subprime mortgages falls back on the simple issue of income qualifications.

At this point, if you are an applicant considering home-buying, FHA is clearly your best bet to finance a home with a low mortgage rate. FHA was never intended to offer an alternative to shady loan applicants. FHA has always required complete income qualifications, whereas most sub-prime lenders offer “stated income” loan programs that could entice applicants who can’t actually afford the mortgage loan as advertised.

FHA mortgage lending continues to offer incentives such as reduced down payments and limited credit availability, but it also stresses the fact that homeownership is for people who can afford to make their mortgage payment each month. FHA recently eliminated down payment assistance loans. Rumor has it that FHA is even considering lowering the cash out refinancing requirements from 95% to 85% loan-to-value ratios.

FHA Mortgage Benefits

Posted on October 21, 2008 by admin 
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FHA insures home mortgage loans that enable low and middle income borrowers to finance or refinance homes in America. FHA loans provide government assistance so Americans can purchase properties and become homeowners. Typically FHA home mortgages provide low rate, reduced lending costs and only 3% is required for the down-payment in most cases.

FHA offers mortgage insurance but they do not make home mortgages. However, the FHA home loan program often minimizes the cost of a home financing and there are no penalties for refinancing or early pay-off. In addition, FHA encourages lending companies to finance loans for borrowers with all types of credit. With FHA’s Section 203(b) program, a homebuyer can purchase a new or used 1-4 family home. FHA home-buyers must occupy the home.

A FHA mortgage enables borrowers with poor credit scores to qualify for the reduced rate loans, rather than taking the higher adjustable rate loan offered by sub-prime lenders. This can save thousands in interest charges. Required down payments are also smaller. Instead of the typical 10% down, a buyer can put down as little as 3%. The closing costs can also be financed with the mortgage, lowering the initial costs of purchasing a home.

FHA Mortgage Refinance Loans Improve Rates

Posted on October 21, 2008 by admin 
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FHA refinance loans are a popular government mortgage that streamlines the home refinancing process for consumers. A refinance loan can be considered a useful finance tool that replaces an existing mortgage using the property as collateral to pay off the old mortgage. In most cases borrowers utilize FHA refinance loans for improving interest rates. Cash out refinancing is another popular type of loan that many homeowners use to obtain capital for home repairs, remodeling and debt consolidation.

FHA home loans are a cost-effective options for homeowners who are suffering with an adjustable rate mortgage that increased monthly payments often making owning a home too costly. FHA refinancing may be the most efficient method to avoid a foreclosure or escape a short sale.

Consumers also like FHA mortgages because they do not have FICO score requirements if your debt to income ratio and employment history meets government loan standards set forth by HUD. Many homeowners go through a period in their life when they make their loan payments late.  FHA mortgage lenders may overlook the delinquencies if the borrower indicates that they have recovered and that the proposed loan offers benefits to the borrower. Because FHA mortgage loans do not require much equity, in most cases they are the best option for consolidating first and second mortgages into a one monthly payment.  Continue article >

FHA Hope For Homeowners Loan Update

Posted on October 21, 2008 by admin 
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There have been many critics of the Hope for Homeowners FHA loan program because many believed that if mortgage lenders did not participate that it would be a moot point.  Last week HUD updated the FHA lender list. As of right now, it is available through an excel spreadsheet on the HUD website.

What is the hope for homeowner program? If you haven’t heard the details of this loan product, try and visit the FHA Home Loan Services site that explains the Hope for Homeowners program or the FHA issued Factsheet.   The H4H FHA loan program attempts to aid troubled homeowners by refinancing their current mortgages into cheaper FHA insured mortgages. One of the characteristics of these FHA loans would be that they can be no larger than 90 percent of the property’s new appraised value; this will help lower costs and help avoid the dreaded route of foreclosure.

Why is this so important? The program itself is quite helpful since it addresses the problems of our housing crisis by refinancing these troubled mortgages.  More importantly, FHA programs like these encourage individuals to simply take action. This could be as simple as calling your lending company or shopping with a few mortgage companies to get a variety of mortgage options.  This FHA loan program will help specific homeowners, as well as set a hopeful trend among homeowners and lenders alike.  With this recently updated list, we are beginning to to see more and more participation and response from FHA mortgage lenders that are making great strides to help homeowners. The FHA has since introduced numerous programs, but the Hope for Homeowners program stands out because it specifically details the discounting of mortgages to address the recent decline in home prices.

While the list has been updated on an excel spreadsheet, you can expect further updates as more lenders participate. To check for updates, remember to visit the FHA site here. If your mortgage lender is still not listed, remember to still call your lender either way. As mentioned, home loan lenders are responding more favorably to loan modifications and working out options with their borrowers due to the recent onslaught of foreclosures. At the moment, HUD expects this list to be updated on Fridays – so if your lender still hasn’t appeared, don’t worry as it may take awhile since the program was only initiated this month.  In addition, HUD advises you to contact the Housing Counseling Agency if you are having trouble communicating with your current lender and/or subordinate lien holders.