New FHA Condo Guidelines Could Limit Mortgage Refinancing

admin — Wed, 09 Sep 2009 13:35:56 +0000

In a June letter to FHA lenders from HUD, the FHA mortgage guideline revisions for condominiums and town homes were announced and documented. Unfortunately for condo owners, the guidelines have tightened for FHA lending and qualifying for mortgage refinancing may become more difficult than in previous years.

Project approval is no longer required for FHA. FHA streamline refinance loans for HUD Real Estate Owned (REO) sales. If you presently have a FHA mortgage and want a streamline refinance then you are blessed with an easier path for lowering your mortgage rate. Currently having a FHA loan is a HUD requirement for FHA streamline refinancing.

Ineligible properties include condominium (“condotels”), timeshares or segmented ownership projects, houseboat projects, multi-dwelling unit condominiums [i.e. more than one dwelling per condominium unit], and all projects not deemed to be used primarily as residential.

Here are some additional standards for condo properties, as explained by HUD:

o At least 50% of the units of a project must be owner-occupied or sold to owners who intend to occupy the units. For proposed, under construction or projects still in their initial marketing phase, FHA will allow a minimum owner occupancy amount equal to 50% of the number of presold units (the minimum presales requirement of 50% still applies).

o No more than 15% of the total units can be in arrears (more than 30 days past due) of their condominium association fee payment.

o Projects consisting of three or less units will have no more than one unit encumbered with FHA insurance.

o Projects consisting of four or more units will have no more than 30% of the total units encumbered with FHA insurance.

Choosing a FHA Mortgage Refinance

admin — Tue, 28 Oct 2008 01:53:11 +0000

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.

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 Mortgage Lending » FHA streamline

New FHA Condo Guidelines Could Limit Mortgage Refinancing

Choosing a FHA Mortgage Refinance