Refinancing with a FHA Mortgage Loan
If you've never refinanced with a FHA mortgage you might think that it's more complicated because you're involved with a government agency. Well, you'll be pleasantly surprised to learn that refinancing with an FHA loan is a lot like the process of refinancing with any other loan. However, with an FHA loan you have many more protections, it will be easier to get qualified and you will most likely get a better interest rate..
Top 5 reasons why home owners refinance [click here]
Determine what kind of loan you have
If you already have an FHA loan, you have a few more options for refinancing than if you than if you have a conventional or other non-FHA loan. Your may qualify for a FHA Streamline loan which enables you to refinance your mortgage with less closing costs and half the paperwork. After you fill out our short form, an FHA Approved lender will contact you and be able to answer all of your questions.
Determine your goals
Maybe you are refinancing your mortgage to get a lower interest rate. Are you looking to consolidate some credit card debt or reduce the amount of years on your loan? Are you refinancing to take cash out of your property to go on vacation, pay bills or put money into savings? Determining your goals for refinancing will help you determine how to proceed and ultimately yield the best results.
Figure out how much you can afford
What you can afford depends on your income, credit rating, current monthly expenses, down payment and the interest rate. There are some online tools you can use to help you, but it's best to visit an FHA-approved lender to find out for sure. Click here to have a FHA specialist help you qualify for a FHA Loan.
Why refinance with a FHA Loan?
There are many reasons to choose a FHA loan to refinance your home mortgage:
- Lower cost
FHA loans have competitive interest rates because they are Federal Government insured loans. The main goal of the FHA is to stimulate economic growth by providing affordable home mortgage loans. - Better rates and programs
FHA mortgage loans offer low fixed rates around 5.00% fixed for 30, and even lower for 15 years. - Easier to qualify
Because the FHA insures your mortgage, lenders are more willing to give loans with lower qualifying requirements, so it's easier for you to qualify. - Less than perfect credit
Even if you have had credit problems, such as bankruptcy or a low fico score, it's easier for you to qualify for an FHA refinance than a conventional refinance. - More protection to keep your home
The FHA has been around since 1934 and will continue to be here to protect you. Should you encounter hard times after buying your home, the FHA has many options to help keep you in your home and avoid foreclosure.
Top 5 Reasons why people refinance [click here]
Click here to see if you qualify for a FHA Home Loan
The Process
The FHA refinance process is pretty straightforward. After you fill out our short form you will be contacted by a FHA approved lender. The loan officer will then help you determine what you qualify for. Assuming that you qualify for the FHA loan and proceeding with the loan yields some sort of benefit, the loan officer will complete a loan application, order a FHA case number and perform a title search on your home. The borrower(s) associated with the loan will need to sign several FHA related mortgage documents called "disclosures" for the loan officer to have on file and ready for loan submission to underwriting.
The lender may then order an appraisal to find the value of the property and determine its condition. An FHA appraisal is no different than other appraisals. The lender will review the appraisal to determine the value of the property, then make a decision on your application.
Once all loan documents are completed and received, the loan will be submitted to underwriting where a bank underwriter will review and approved your loan, issuing a loan commitment. Once all of the stipulations on the loan commitment are satisfied, the loan will be in a "clear to close" status and you are ready to go to closing.
At closing, be sure to read everything before you sign. Make sure your interest rate, monthly payment and closing costs are the same or very similar to the figures you were quoted at the beginning of the process. Be sure that if you applied for a fixed rate refinance, you got a fixed rate and not an adjustable rate mortgage loan. In most cases the lender will provide an attorney that will review and explain the documents you are signing.
