Those who may have a non-FHA loan that is delinquent, and would like to refinance into an FHA secured mortgage, must fully qualify for the rate and term refinance. Once you go from and FHA loan to another FHA loan, you are then eligible to take advantage of the FHA streamline refinance program.
So, just to recap:
• The current mortgage must be FHA insured, and the mortgage must be current.
• The borrower must have a minimum fico score of 640.
• The refinance must lower your principal and interest payment.
• The borrower cannot receive cash out of more than $500.
• The borrower must bring one pay stub to show the ability to repay, but nothing is done with the paystub.
• Any second liens can remain in place, as long as they are still subordinate to the first.
• The term of the new loan must be the lesser of 30 years, or the unexpired term of the mortgage plus 12 years. You cannot go from a15 year loan to a 30 year loan.
• An appraisal is not required unless the closing costs are included into the loan, and the appraisal cannot put the borrower upside down. Those streamline refinances without an appraisal, are limited to the unpaid principal balance, minus any refund credit of the mortgage insurance premium, plus the new upfront MIP if it is to be financed into the mortgage/
• No termite report is required.
• The borrower must have a minimum of 6 months of pay history.
• The borrower will need to provide one bank statement, and one mortgage payment to the closing table.
• Lastly, the borrower cannot be late or delinquent on any federal debt.
These are just the basic details, but with FHA the possibilities are endless, not to mention the rates are the lowest they have been in 50 years. The average FHA interest rate is 5.75, and can go as low as 4.5 if you qualify and the rates are available. The rates fluctuate daily with the market, but you can still look at the options with a 15 or a 30 year fixed rate. With as low as the rates are now, you will never need to refinance again. For more information on FHA, and how you can begin the process today, you can visit my website at www.fhaloansnow.net, or you can call me directly at (310) 498-2700.
Showing posts with label fha refinance. Show all posts
Showing posts with label fha refinance. Show all posts
Tuesday, July 13, 2010
Thursday, June 10, 2010
FHA and Gifted Funds
Believe it or not, with all of the fraud in FHA, it is no wonder that they have asked that gifted funds be documented every step of the way. FHA and gifted funds do get along, but it does have some strings attached.
With FHA priding themselves on commonsense lending, they also consider it commonsense that the person gifting you funds is logic; meaning a parent, sibling or other close relatives. FHA will allow other sources to fund you, but it has to make sense. In some circumstances it would be an employer or a close friend or current roommate, but FHA’s guidelines on gifted funds simply state it needs to be verified.
The reasoning behind verifying the gifted funds makes perfect sense. The lender knows that statistically speaking those who enter into a transaction with no invested funds are more likely to default on a loan, so it is in the best interest of all involved for FHA to verify gifted funds.
Many times the buyer may take it personal, but it really isn’t meant to invade your privacy, but understand that FHA has already allowed for low down payment funds up front. They only now ask for as little as 3.5% down so there isn’t a huge out of pocket needed depending on how much you are spending.
The fact that FHA allows gifted funds is a gift in itself. This is something you would be hard pressed to do on a conventional loan, so beware.
For more information on FHA and gifted funds, please visit my website at www.fhaloansnow.net.
-Mayer Dallal
With FHA priding themselves on commonsense lending, they also consider it commonsense that the person gifting you funds is logic; meaning a parent, sibling or other close relatives. FHA will allow other sources to fund you, but it has to make sense. In some circumstances it would be an employer or a close friend or current roommate, but FHA’s guidelines on gifted funds simply state it needs to be verified.
The reasoning behind verifying the gifted funds makes perfect sense. The lender knows that statistically speaking those who enter into a transaction with no invested funds are more likely to default on a loan, so it is in the best interest of all involved for FHA to verify gifted funds.
Many times the buyer may take it personal, but it really isn’t meant to invade your privacy, but understand that FHA has already allowed for low down payment funds up front. They only now ask for as little as 3.5% down so there isn’t a huge out of pocket needed depending on how much you are spending.
The fact that FHA allows gifted funds is a gift in itself. This is something you would be hard pressed to do on a conventional loan, so beware.
For more information on FHA and gifted funds, please visit my website at www.fhaloansnow.net.
-Mayer Dallal
Wednesday, May 26, 2010
FHA is All the Rage!
FHA is talked about so much that people aren’t sure what to believe. We hear about great low rates, easy processes and it’s all hard to believe because of where we are today. So, what does this all mean? Do consumers even care?
Being comfortable with the process has a lot to do with what choices we make. If you aren’t comfortable with the process, then don’t make a move. However, it is your responsibility to become informed before choosing FHA, or any loan for that matter. Without information, what do we have? Knowledge is power, and without that, we are lost.
Becoming educated is half the battle. Once you have the information on FHA, you can make a decision. Once you make a decision you need to act on it. Knowing what FHA does is helpful, because you don’t want to be misled. FHA is the Federal Housing Administration, and they insure loans for private lenders. This may include some banks, and some credit unions, but make sure before you get into the process.
FHA does not loan money, but they insure the loan; so, they guarantee the lender that if you default on the loan that they will pick it up. This all sounds so great, but so many people didn’t get this loan because they didn’t know anything about it. Everyone runs around screaming conventional, and they don’t know what it means.
Check out my website, www.fhaloansnow.net for more information, or email me directly at mdallal@fhaloansnow.net.
-Mayer Dallal
Being comfortable with the process has a lot to do with what choices we make. If you aren’t comfortable with the process, then don’t make a move. However, it is your responsibility to become informed before choosing FHA, or any loan for that matter. Without information, what do we have? Knowledge is power, and without that, we are lost.
Becoming educated is half the battle. Once you have the information on FHA, you can make a decision. Once you make a decision you need to act on it. Knowing what FHA does is helpful, because you don’t want to be misled. FHA is the Federal Housing Administration, and they insure loans for private lenders. This may include some banks, and some credit unions, but make sure before you get into the process.
FHA does not loan money, but they insure the loan; so, they guarantee the lender that if you default on the loan that they will pick it up. This all sounds so great, but so many people didn’t get this loan because they didn’t know anything about it. Everyone runs around screaming conventional, and they don’t know what it means.
Check out my website, www.fhaloansnow.net for more information, or email me directly at mdallal@fhaloansnow.net.
-Mayer Dallal
Thursday, May 20, 2010
Rent Credits Toward Your New Home Purchase
Rent to own is a popular option these days, and they do work out well for some who are looking to buy a home in the future, but how does this work?
The rent credit is established when a renter takes on a lease agreement stating that a portion of this payment will go towards the down payment of the property. The lease agreement must clearly state and account for this being the case. There must be a clause within that agreement that states how much of the down payment will go toward the purchase of this home. In this case, it is the lender’s responsibility to show that the estimate is above FHA’s required fair market rent. If the amount is not above, then the amount will be deducted from the sale price of the home as seller concessions.
When buying a home, you will have your down payment to consider as well as your closing costs. To aid in limiting the amount of money that the seller needs to bring to closing, the realtor and seller can agree to pay all or most of the costs. Before finalizing anything, make sure that you understand what is required of you in terms of money, because you need to be financially prepared.
The rent credit is established when a renter takes on a lease agreement stating that a portion of this payment will go towards the down payment of the property. The lease agreement must clearly state and account for this being the case. There must be a clause within that agreement that states how much of the down payment will go toward the purchase of this home. In this case, it is the lender’s responsibility to show that the estimate is above FHA’s required fair market rent. If the amount is not above, then the amount will be deducted from the sale price of the home as seller concessions.
When buying a home, you will have your down payment to consider as well as your closing costs. To aid in limiting the amount of money that the seller needs to bring to closing, the realtor and seller can agree to pay all or most of the costs. Before finalizing anything, make sure that you understand what is required of you in terms of money, because you need to be financially prepared.
An FHA Checklist for You
When applying for an FHA loan, here are a few things you will need to bring with you to your appointment.
1) Make sure we have your residential address for the past two years.
2) We need your social security number in order to pull your credit report.
3) Names and addresses of your employers over the past two years as well.
4) We will need to know your gross monthly salary at your current job. If you work more than one job we will need that information too, so we can include that in your income.
5) We will need all pertinent information to your checking and savings accounts.
6) We need any pertinent information for any loan you are currently paying on; that includes any installment loans, mortgage loans, and credit cards.
7) All information pertaining to other real estate you might own; this would include rental property, commercial property etc.
8) An approximate of all personal property is helpful, because if you own anything of value, the lender will consider that as security for your loan.
9) If you are a veteran, we will need your certificate of eligibility. This form is also known as a DD-214.
10) Your two most recent paystubs and w2’s for the past two years. We need to make sure that we are looking at the correct year-to-date income for you.
11) Personal tax returns over the past two years are required if you are self-employed, and a business balance sheet is helpful.
This is the documentation that is necessary to help get your loan started. Over the process we may need more documentation as everyone’s needs are different.
1) Make sure we have your residential address for the past two years.
2) We need your social security number in order to pull your credit report.
3) Names and addresses of your employers over the past two years as well.
4) We will need to know your gross monthly salary at your current job. If you work more than one job we will need that information too, so we can include that in your income.
5) We will need all pertinent information to your checking and savings accounts.
6) We need any pertinent information for any loan you are currently paying on; that includes any installment loans, mortgage loans, and credit cards.
7) All information pertaining to other real estate you might own; this would include rental property, commercial property etc.
8) An approximate of all personal property is helpful, because if you own anything of value, the lender will consider that as security for your loan.
9) If you are a veteran, we will need your certificate of eligibility. This form is also known as a DD-214.
10) Your two most recent paystubs and w2’s for the past two years. We need to make sure that we are looking at the correct year-to-date income for you.
11) Personal tax returns over the past two years are required if you are self-employed, and a business balance sheet is helpful.
This is the documentation that is necessary to help get your loan started. Over the process we may need more documentation as everyone’s needs are different.
FHA Refinance buzz
FHA refinance and purchase is the way to go for any borrower. For many years it was misunderstood that FHA was for people that were bad credit, or had middle of the road credit but that just isn’t the case. FHA takes some time and patience, and I am here to help, but there are a few things you should know.
FHA refinance loans can either be done in what is called a streamline or a cash -out loan. The streamline FHA loan allows you to refinance just the loan, while the cash out loan is an option if you want to take up to 85% of the home’s value to do so. The refinance option will allow you to take up to 97.75%. These limits are just simply a guideline to prevent another economic crisis like what we are having now. These limits also will prevent you from going into a payment that is much larger than what you have right now.
Any loan that is not currently an FHA loan can certainly be refinanced to an FHA loan. In order to determine what your debt load is, they will look at what you owe on the home and your existing debts outside of that.
Consider that when your pay off from your current home loan comes in, it may include any unpaid interest calculated through the end of the month, and will include any late fees that were tacked onto your loan from the past. Escrow shortages can also account for this final payoff, so be prepared to consider how you want to refinance your loan before you start the process. If you aren’t sure what to do I can help. For more information, you can go to www.fhaloansnow.net. There is a lot of information and a place for you to fill out information to get a quote today.
FHA refinance loans can either be done in what is called a streamline or a cash -out loan. The streamline FHA loan allows you to refinance just the loan, while the cash out loan is an option if you want to take up to 85% of the home’s value to do so. The refinance option will allow you to take up to 97.75%. These limits are just simply a guideline to prevent another economic crisis like what we are having now. These limits also will prevent you from going into a payment that is much larger than what you have right now.
Any loan that is not currently an FHA loan can certainly be refinanced to an FHA loan. In order to determine what your debt load is, they will look at what you owe on the home and your existing debts outside of that.
Consider that when your pay off from your current home loan comes in, it may include any unpaid interest calculated through the end of the month, and will include any late fees that were tacked onto your loan from the past. Escrow shortages can also account for this final payoff, so be prepared to consider how you want to refinance your loan before you start the process. If you aren’t sure what to do I can help. For more information, you can go to www.fhaloansnow.net. There is a lot of information and a place for you to fill out information to get a quote today.
Subscribe to:
Posts (Atom)
