Great New Loan Program Being Released by PHFA

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I'm excited to announce that PHFA has released two  brand-new conventional loan programs that will help many buyers and sellers who want to purchase or refinance around our area. As you know, PHFA stands for Pennsylvania Housing Finance Agency. The new programs are the HFA Preferred and HFA Preferred Risk Sharing.

These programs are absolutely fantastic because it allows new homebuyers to only put 3% down and with lower or no mortgage insurance. Another great aspect of these loan options is that it can be used for either purchasing a home or refinancing an existing mortgage. Before, the Pennsylvania Housing Finance Agency didn't have any offerings for refinances. Now, their new loan programs will allow existing homeowners who may not have much equity to still be able to refinance their homes. Specifically, PHFA will allow homeowners to do a rate and term refinance up to a loan-to-value of 97%, e.g. for an appraisal value of $200,000, you can refinance up to $194,000.

Of course, there are a few limitations such as following the PFHA income limitations. Throughout Philadelphia, Montgomery, Delaware, Bucks, and Chester counties the maximum allowable income is $97,800. Keep in mind that the programs only apply to one-unit primary residences – no duplexes or investment properties. The interest rates are slightly higher than regular FHA or conventional loans, but as the chart in the video points out, the total monthly mortgage payment would still be notably lower in most cases.

PHFA announced the release of the new programs this past Friday, April 27th. These two new mortgage programs give prospective homebuyers and current homeowners alike more affordable opportunities to save money whether purchasing your first home or refinancing your forever home.

Make sure to contact me with any questions you have about your real estate financing needs. I am always happy to answer your questions or even run numbers for you to make sure that you have the right kind of financing for your needs.

FHA Streamline Refinances Adapted to Cost Less to Mortgage Holders

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There is exciting news in the mortgage and housing industry and I couldn’t wait to share it with you!  Effective June 11, 2012 all FHA mortgages that were originated prior to June 1, 2009 will be eligible to apply for a FHA streamline refinance with new, low mortgage insurance rates.  This comes at a time when mortgage insurance rates have witnessed a hike for newer applications and is welcome relief for the millions of Americans facing underwater properties if they continue to experience financial difficulties.

The changes will make it possible for millions of people to break free from the difficult situations they might be in by reducing monthly mortgage payments as a result of refinancing that will ensue with lower mortgage insurance premiums.

Lower One-Time and Monthly Mortgage Insurance Premiums

Homeowners that fall into this category of eligible mortgage holders will enjoy a reduced one-time mortgage insurance cost.  As per the changes, streamline refinance applicants will pay 0.1% of the loan amount in mortgage insurance – an almost insignificant amount.  Monthly premiums will be reduced to approximately half the current rate – with the new amount being 0.55%.

No Income, Asset or Employment Verifications

The most popular aspect of this program is that there will be no need for homeowners to endure the long and sometimes grueling process of income, asset and employment verification.  Not only will this be comforting for those already facing financial difficulty as a result of things like job loss, but it will also speed the process up for applicants.

Appraisal Not Required for FHA Streamline Refinance

The program also allows a refinance without any appraisal on the home – again, making it a simpler and easier thing to go through for homeowners.  This comes as welcome relief to them at a time when often their homes that have seen a significant reduction in value over the past several years.

Faster Application Processing Lead Times

Since very little extra verification and processing are needed on these applications, the FHA streamline refinance process is far quicker and more efficient than standard loan applications – allowing homeowners to focus on more important things rather than worrying about their refinance application.
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The single biggest exciting factor with these changes is that the people that at one time were unable to apply for a refinance because of increased mortgage insurance premiums, will now be able to avail the opportunities that are out there.  They will not only be able to obtain a refinance at a lower cost initially and monthly in terms of mortgage insurance but they will also enjoy a lower overall cost of the mortgage with the low interest rates.

To find out if you qualify or to learn more, contact your loan officer today.  It is a great time to get a streamline refinance with FHA right now and we’d be happy to assist in this and all of your real estate endeavors!