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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!
