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Arizona FHA Refinance With No Appraisal Required

January 23, 2009 3 Comments

Is it possible to do an Arizona FHA refinance with no appraisal?

Many people in Arizona want to take advantage of low interest rates, but currently owe more than their house is worth because property values have went down over the last couple of years. If you are currently in an FHA or VA loan, it may be possible for you to do an Arizona FHA refinance on your home – with no appraisal required.

Which means that if you currently owe more than your house is worth, you can still take advantage of lower interest rates and refinance your current FHA or VA loan.

The official program name is the FHA streamline refinance program and it is available to all FHA borrowers who have made their payments on time for the last 12 months.  The Arizona FHA refinance streamline program is designed to allow eligible borrowers to lower their interest rate without having to completely re-qualify for a new loan. There are no income or asset documentation requirements for the Arizona FHA refinance streamline program.

When participating in the Arizona FHA refinance streamline program, in order for no appraisal to be required, you cannot exceed your old loan amount by more than 1.5% (the exact amount of Up Front Mortgage Insurance Premium that is required on your new loan) or an appraisal will be required. So to exactly answer the question of:

“Is it possible to do an Arizona FHA refinance with no appraisal?”

The answer is “Yes” – as long as your new total loan amount doesn’t exceed your old loan amount by more than 1.5%!

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FHA Streamline Refinancing: Is A Local Arizona Loan Officer Better?

January 21, 2009 2 Comments

If you are reading this, the chances are high that you are investigating what the FHA streamline refinancing program is and whether or not it makes sense in your case. Even though the FHA streamline refinancing program is relatively easy to understand when compared to other FHA loan programs, chances are that you will learn even more about the program by speaking with a loan officer over the phone.

Assuming that the loan officer knows what he or she is talking about! I am amazed at the number of people that I speak with that say “no one ever explained that to me before…” so I thought I would take a second to outline the “normal” choices that a consumer has when choosing a loan officer.

First, let me begin by saying that there are great loan officers at almost every lender – just as there are not-so-great loan officers at every lender. In general, there are three different groups of lenders where loan officers work that can help you with the FHA streamline refinancing program.

FHA Streamline Refinancing Lenders Groups

  1. Group #1 National Banks
  2. Group #2 Call-center based companies
  3. Group #3 Local Arizona loan officers

In general, the FHA streamline refinancing lenders will all have similar interest rates and fees (they have to be competitive or they are no longer in business…) and the difference is how much of a local, personal touch you want to experience.

If you don’t mind dealing with someone who is sitting 500 or 5,000 (India!) miles away working in a call center overseeing your loan, you may want to choose working with a call center based company.

If you have a great relationship with the bank where you have your checking and savings account at – you may want to work with one of the large national banks.

If you prefer to work with FHA Streamline refinancing experts who live and work in the community that you live… then you may want to opt to go with a local Arizona loan officer who is an expert in the FHA streamline refinancing programs.

But… no matter what… you might want to hurry – before rates go back up!

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FHA Streamline Refinance: When Can You Lock Your FHA Streamline Rate?

January 19, 2009 Leave a Comment

Many people are taking advantage of the FHA streamline refinance program because interest rates are significantly lower than they were when they took out their FHA loan.

When doing an FHA streamline refinance, when can you lock your loan?

Each lender is different, but generally speaking, you must have completed an application and provided the required documentation that you can indeed qualify for an FHA streamline refinance. The application process involves meeting with a loan officer and completing the initial disclosures and typically takes about 30 minutes to an hour.  Sometimes this can be done over the phone – depending on the situation.

For an FHA streamline refinance, how long is my lock good for?

When your loan officer locks your loan for an FHA streamline refinance, typically they will lock it for 30 days. They may also lock it for 15 or 45 or even 60 days – so be sure that you ask them how long they are locking the rate for. Because so many people are trying to do an FHA streamline refinance right now, the lenders turn times are a little slower than normal – so I would recommend locking for *at least* 30 days.

When you lock for an FHA streamline refinance, you are “locked”.

Once your rate is locked for an FHA streamline refinance, your rate is “locked” and won’t move – meaning, it won’t go up or down.  It is also possible to extend the lock as needed for a few days if you need a little more time to get the transaction done — but there is a cost to extend and the cost varies by period and lender.

With an FHA streamline refinance, the lock process can be confusing so be sure to ask your lender about their lock process. Many times, each lender will have a slight variation to the process, so it is in your best interest to ask the question up front and know exactly how the lock process goes.

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FHA Streamline Program: 3 Questions To Ask Your Loan Officer About UFMIP

January 16, 2009 3 Comments

It is surprising how many people I speak with who have talked to other loan officers about an FHA streamline refinance who have not gotten all of the information they need to make an educated decision.

On occasion, I run into people who have gotten actual mis-information from a loan officer, but most often, I find that they loan officer just didn’t know – or if they did know, they weren’t telling!

Here are 3 simple questions that you can ask your loan officer about your up-front UFMIP (Up Front Mortgage Insurance Premium) account that will tell you how much they know or don’t know about how FHA loans work – and specifically, how the FHA streamline program works.

Question #1: How much did I pay in UFMIP?

Let’s try a tricky question first. Your loan officer should be able to tell you how much UFMIP you paid based on when you took out your FHA loan. He should also be able to tell you how much money is left in your UFMIP account and how the UFMIP account works. And why FHA charges UFMIP…. sorry, I got a little carried away, and that one question turned into 4 questions that  you could ask before I stopped myself.

Question #2: Is everyone required to pay UFMIP?

This is a “gimme” — yes. Everyone who takes out an FHA loan is required to pay UFMIP – no question.

Question #3: What is the difference between UFMIP and MI?

Also pretty easy – UFMIP stands for Up Front Mortgage Insurance Premium and is a one-time fee. MI stands for Mortgage Insurance and is paid each month as part of your monthly payment.  MI only goes away once you have paid down your FHA loan to approximately 80% of what you borrowed.

If you ask these questions to a loan officer, they should absolutely, positively know these answers – and it will be a good sign that they can help you with the FHA streamline program.

If they stumble or don’t know?

Have ‘em call me.

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FHA Streamline Refinance: Can You Streamline If Your Current FHA Loan Is Above The 2009 FHA Loan Limit?

January 16, 2009 1 Comment

In 2008, the FHA loan limit for Maricopa county was $346,250. In 2009, the FHA loan limit for Maricopa county is $271,050.

A few people that I have spoken to recently are in a situation where they got an FHA loan in 2008 for an amount that is greater than the FHA 2009 loan limit and they want to do an FHA streamline refinance.

Can you do an FHA streamline refinance if your current FHA loan is above the current FHA loan limit?

No.

Not as of today.

That is the bad news.

The good news is that lenders expect FHA to issue an official announcement allowing people who are currently in an FHA loan that is above the 2009 FHA loan limit to be able to participate in the FHA streamline program.

As always, we will keep you posted when the official announcement is made.

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Filed Under: Arizona Home Financing Options, FHA Streamline Refinance Program, Mortgage Guidelines

FHA Streamline Refinancing: How To Get A “Free” Mortgage

January 16, 2009 1 Comment

Question:

How do you get a “free” mortgage?

Answer:

You really don’t. Title companies get paid, lenders get paid, appraisers get paid, the government recording offices get paid, credit reporting companies get paid… it is just a matter of who pays them – you or “the bank”.

Here is how to get the closest thing to a free mortgage that I can think of…

How to get the bank to pay your closing costs

Many times I speak with people who want a “no out of pocket closing costs mortgage”. Note – there is a difference between a “no out of pocket closing costs mortgage” and a “no closing costs mortgage”. The difference simply is that with one, you roll all of the costs into your new mortgage (you will pay the costs, just over the term of your mortgage) and with the other you get the bank to “pay” your closing costs.

Why will the bank pay your closing costs?

They will pay your closing costs in exchange for a slightly higher interest rate.

Put simply, the situation may look like something like this: If you are willing to pay your closing costs and have them rolled into your loan, the rate on your mortgage may be 5%. OR. If you don’t want to pay your closing costs and have the bank “pay” your closing costs – your interest rate might be 5.5%.

A subtle but important difference.

There really isn’t such a thing as a “no closing cost” mortgage – it is just a matter of who pays the closing costs — you or the bank. And if the bank pays them? Expect your interest rate to be higher than it would be if you paid them.

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FHA Streamline Refinance: When Does It Make Sense?

January 15, 2009 Leave a Comment

The FHA streamline refinance program is an easy way for people who are currently in an FHA loan to lower their monthly payments without having to completely re-qualify for a new rate.

The main criteria for being able to qualify for the FHA streamline refinance program are:

  1. You must occupy the property as your primary residence
  2. You can’t have more than 2 30-day late payments on your mortgage in the last 12 months
  3. You can’t participate in the FHA streamline refinance program unless the benefits outweigh the costs — or, in other words – you had better save money and be in an overall better financial position.

How much money can you save with the FHA streamline refinance program?

How much can you save if you decide that the FHA streamline refinance program is something that you want to do? It depends on your loan amount and what your current interest rate is.  Here is a simple example of what your savings could possibly be:

  • Loan amount = $150,000
  • Current interest rate = 7%
  • Current principal + interest = $998
  • New interest rate = 5%
  • New principal + interest payment = $805
  • Monthly savings = $193/month

When does the FHA streamline refinance program make sense? Well, if you are in a $150,000 loan and currently have a 7% interest rate, it would only make sense if you wanted to save $193/month on your mortgage payment.

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Arizona FHA Streamline Program: 3 Basic Criteria to Qualify

December 15, 2008 9 Comments

Arizona FHA Streamline: Who Qualifies?

The FHA streamline is more popular today than it was a few years ago because of the number of people who currently have an FHA mortgage is higher than it has been in recent years.

And if you are currently in an FHA loan, often times your best financial move when rates drop is to participate in the FHA streamline program.

Can anyone participate in the FHA streamline program? Almost.  There are 3 basic criteria to the FHA streamline that must be met in order for someone to participate.

Criteria to Participate in the FHA Streamline Program

  1. You must currently have an FHA loan and live in the property
  2. You can’t have more than 2 30 day late payments in the last 12 months
  3. FHA won’t let you participate if the FHA streamline program doesn’t improve your overall financial situation (lowers your rate, fixes your adjustable rate, etc.)

Most people that I speak with are eligible for the FHA streamline program and with rates lower than they have been in years, if you currently have an FHA loan, it probably makes sense to find out if you meet the 3 criteria to qualify for the FHA streamline program.

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