An FHA mortgage loan can very well be one of the best options to refinance an existing home loan.  The list of disadvantages are few and there are far fewer conditions that can turn down an FHA application unlike the regular loan applications in which the borrower has meet a variety of qualification standards including minimum credit score and credit history requirements.

The easiest FHA refinance option is the streamline refinance.  FHA streamline is a refinance program for homeowners that currently have an FHA mortgage loan.  The streamline refinancing option is called a streamline because it allows the borrower to reduce the mortgage interest rate on their current home loan quickly and oftentimes without an appraisal.  The FHA streamline refinances also cut down on the amount of paperwork that must be completed by the applicant and the mortgage lender, saving time and money.

The standard requirements needed to qualify for an FHA streamline refinance include a the requirement that the new refinanced loan results in a lower monthly mortgage payment for the borrower, the existing mortgage that is being refinanced cannot be currently delinquent and no cash may be taken out with the new mortgage loan.

The streamline refinance will generally not require any income verification from the borrower or co borrower and an appraisal is not required.  Homeowners who owe more on their mortgage than their house is worth may be eligible to qualify for an FHA refinance.

Mortgage lenders have the option of charging borrowers a slightly higher rate than the standard market rate for an FHA loan and use the premium received to pay any closing costs that borrower would normally be charged for the refinance transaction.

For those borrowers that are looking for something more from their refinance, FHA mortgage refinance can be performed that allow for cash back based on the amount of equity in the home.  FHA refinances, not the streamline program, allow for cash out refinances up to 85% of the value of the home.  Borrowers can use these refinances to consolidate an existing first and second mortgage into a single home loan or for debt consolidation programs.  As with most all FHA loans, refinances with the FHA have easier credit and income qualifications.

All FHA mortgage rates have remained very competitive for borrowers even for borrowers that have filed bankruptcy more than two years ago.  Mortgage refinancing with a FHA loan is relatively easy and can be advantageous for homeowners that have a variety of credit, income and financing needs.

This information is provided for informational purposes, not for specific financial advice.  Additional resources to help consumers find the best mortgage program are available at FHA mortgage rates.

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