Who is an FHA Loan Best For?
Not sure if your current finances will let you qualify for a mortgage? An FHA mortgage could be your solution. Run by the Federal Housing Administration, FHA home loans were created to make it easier for home owners to qualify for a loan – whether to buy a home or refinance your mortgage.
FHA home loans can benefit almost all home buyers and refinancers – first-time home buyers, military families, lower-income families and homeowners who don’t want to tie up a lot of cash in their homes.
FHA mortgages are great for people who desire a secure government-insured home loan, while also needing to finance more than 80% of their home value. Check in with a home loan expert or call us at 1-866-934-7283 to review your options to see if an FHA home loan is the best fit for you.
What Are The Benefits of an FHA Loan?
Qualifying for an FHA loan is less difficult than other loan options. With an FHA mortgage, you can buy a home with a down payment as small as 3.5% and lower credit scores. There are also no income limits for an FHA loan, which you might find with other programs.
With an FHA loan, you are able to use gifts (such as borrowed money or a monetary gift from a family member) towards down payments and closing costs.
There are no prepayment penalties with an FHA mortgage, allowing you to refinance or pay off your home early without having to worry about paying an extra fee.
What is the FHA Streamline Refinance Program?
The FHA Streamline Refinance program is a special refinance program for people who have an FHA loan. It is the simplest and easiest way to refinance an FHA loan. Unlike traditional refinance, the FHA Streamline Refinance program allows a borrower to refinance without having to verify their income and assets.
An appraisal might not be required either depending on how much you have paid on your original loan balance. One of the most advantageous aspects of this program is that it allows for an unlimited loan-to-value ratio. Therefore, if you are severely underwater, you still may be able to take advantage of low mortgage rates by refinancing with the FHA Streamline program.
Criteria for Qualifying
- You have to live in the house you are refinancing.
- You can’t have made more than two, 30-day late payments on your FHA mortgage in the past 12 months.
- You have not completed an FHA Streamline Refinance in the past 6 months.
- FHA does not have a minimum credit score required for a streamline refinance, but your lender might.
- Generally it’s best if you have a score of 620 or above.
FHA Streamline With Appraisal
The advantage of doing an FHA Streamline Refinance with an appraisal is that you are able to roll your closing costs into the loan. You are only required to have an appraisal if your new loan amount exceeds your original loan amount by 1.5 percent.
FHA Streamline Without Appraisal
If you do an FHA Streamline Refinance without an appraisal you are not able to roll your closing costs into the loan. Hence, you will need to be prepared to pay your closing costs out of pocket or talk to your lender about whether they can cover your closing costs in exchange for paying a higher interest rate.
How do you get started?
Call today to find out more about the FHA Streamline Refinance program – or start your FHA Streamline Eligibility application now.
To learn more about the FHA Streamline Refinance program, visit the U.S. Department of Housing and Urban Development (HUD) website.
Why Mortgage Masters Group?
At Mortgage Masters Group, we work with you the way you prefer. Whether you prefer to talk face-to-face, over the phone or entirely online, we’ll still be able to provide you with the mortgage and rates that fit you!
More Information about an FHA Loan
Consumer Financial Protection Bureau
What is an FHA loan?