FHA announced a big reduction in FHA Mortgage Insurance Premium fees on FHA Streamline refinances for California homeowners who acquired their FHA loan prior to June 1, 2009. This will significantly reduce the cost of an FHA streamline refinance and reduce the overall monthly payment for borrowers who qualify.
The reduced FHA streamline mortgage insurance fee/premium’s will take effect June 11, 2012 and is part of President Obama’s initiative to reward responsible homeowners.
What is an FHA Streamline Refinance? (click to read)
You just need to document on time payment of your mortgage for 12 months and have a minimum credit score of 640. Debt to income ratios are not calculated, thus not a factor. Call me at (951) 215-6119 for more details.
3 Reasons This is Big Deal For FHA Borrowers
- Many California FHA homeowners have lost value or may be up side down. The FHA streamline does not require an appraisal be completed, so home value is not an obstacle in qualifying for a lower rate and payment.
- Most eligible borrowers have monthly MIP premium rates of .50% or .55%, with mortgage rates around 5.0% to 6.0%. Doing a streamline refinance under the old higher streamline mortgage insurance rates would have increase their MIP rate and eliminated the benefit of refinancing into a lower rate.
- Lower FHA mortgage insurance rates = less cost = lower payments = saving you money!!! Enough said.
Get this ==> FHA Streamline Refinance Rate Quote
Lower FHA Streamline Annual (monthly) Insurance Premium (MIP)
The new FHA streamline annual premium, which is paid monthly by the borrower, will now be .55%. This is a much lower premium rate than the old FHA Streamline rate.
Lower FHA Streamline Up Front Mortgage Insurance Premium (UFMIP)
The UFMIP is a one time fee collected by FHA and added to the loan balance. FHA recently announced an increase of UFMIP to 1.75% starting April 1st, but this new FHA streamline refinance UFMIP rate is only .01%. That’s amazing!
Should you Apply for the New Lower Cost FHA Streamline Refinance?
I’ll answer that for you….yes:-) Many homeowners will be able to reduce their mortgage payment $100 to $400/month! If that isn’t enough incentive, I don’t know what is.
You may even want to consider using that monthly savings to apply towards the principle loan balance and accelerate the pay off of your loan, essentially converting that loan into a 15-20 year loan! This would result in HUGE saving in paid interest.
Doing this would also allow you to eliminate or get rid of your FHA monthly mortgage insurance even sooner!
Get this ==> FHA Streamline Refinance Rate Quote
Can I Qualify for an FHA Streamline Refinance if My Home is Upside Down or Under Water?
Yes, FHA has a NO APPRAISAL FHA streamline refinance option. Not only is the FHA mortgage insurance premium lower, our lender fees are lower for FHA streamlines.
Have questions? Now sure if you qualify for the new lower FHA Streamline Refinance Mortgage Insurance Premium rates? Email me brad@homeloanartist(dot)com or call (951) 215-6119 if you are in California.
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