Up until now, the FHA streamline program was a hard product to use because of having to bring money in to close. This was due to establishing a new impound/escrow account for taxes and insurance while your current lender held your escrow account until after they were paid off. However, that changes in October as do some other things.

In October, the current lender will be paying the taxes from the current impound account. In October, FHA will be increasing (probably) the price of yearly (paid monthly) mortgage insurance. However, in regard to the mortgage insurance, any loans in process (FHA case numbers assigned) will be on the old rate.

I love giving examples, take this one for instance:

Now is the perfect time to think about an FHA to FHA refinance. Mortgage insurance rates are going up. Taxes will soon be paid. No appraisal or income qualification. As long as your mortgage is, and has been, current, it can be done. Why not save money on your monthly mortgage payment while saving thousands of dollars on interest over the life of the loan? If your rate is higher than this or you owe more on your loan than this, your savings could potentially be a lot higher. Let’s talk!

It is time to start the process to get that case number assigned and the rate you need to make the process work. We need to get going to take advantage of the window of opportunity being provided. I can help you with your refinance in either Oregon or California.

Contact me

Navigating the mortgage approval process can be daunting. You need someone on your side. I am available right now to help you with the loan process and know the ins and outs of FHA, VA, USDA and conventional financing. If you want to buy a home using an FHA loan or refinance using VA, I am here to help. Contact me at Alpine Mortgage Planning, 1200 Executive Pkwy., Ste. 100, Eugene OR 97401, 541-342-7576/541-221-3455 cell or by e-mail. Only you can make the choice it is time to get the process started.

Save on monthly payments

FHA Streamline Refinance Makes Sense is a post from: FHA Loans Oregon

Here are the eligibility requirements:

• Existing loan to be refinanced is not FHA insured;
• Must owe more on their mortgage than the value of the property;
• Must be current on the existing mortgage to be refinanced;
• Must have a “FICO based” decision credit score greater than or equal to 500;
• Existing first lien holder must write off at least 10% of the unpaid principal balance (UPB);
• Loan-to-value (LTV) ratio of no more than 97.75%;
• Combined loan-to-value (CLTV) ratio must be 115% or less; and
• For manually underwritten loans, the qualifying ratios can be no greater than 31/50.

Additionally, standard FHA underwriting requirements apply. That should be interesting since nothing about this program is “exactly” standard. Also, homeowners are not eligible for the program if they have a conviction for (a) felony larceny, theft, fraud, or forgery; (b) money laundering; or (c) tax evasion within the past 10 years.

One of the parts of the program I thought would be most helpful is for those that have a 1st and 2nd mortgage on their property because it allows a CLTV (combined loan to value) of 115%. However, when looking over the program details, I think this may become very complicated. For instance, the first mortgage holder must reduce the principal by a minimum of 10% and a maximum LTV (loan to value) of 97.75% and they receive payoff of that amount. The second mortgage holder will have to reduce their loan amount to the 115 percent CLTV mark and they will receive a “refinance compensation” from the Treasury and HUD for the amount they forgave and payments on the remainder. This is a complicated formula.

I am very interested in seeing how this plays out. As the Realtors® I have talked to can attest, second mortgage holders can be a source of annoyance on a short sale transaction and this is a “short” refinance transaction. It can take several months to get an answer from the 2nd mortgage holder and in this scenario, they aren’t getting paid up front, they will still have to take payments. They also have to register with Fannie Mae to be able to receive the compensation from HUD.

Contact me

This is still in its preliminary stages, but if you are interested in applying for this program, it is not too early to start the process, it will probably take some time to get the proper approvals from current lien holders. Navigating the mortgage approval process can be daunting. You need someone on your side. I am available right now to help you with the loan process and know the ins and outs of FHA, VA, USDA and conventional financing. If you want to buy a home using an FHA loan or refinance using VA, I am here to help. Contact me at Alpine Mortgage Planning, 1200 Executive Pkwy., Ste. 100, Eugene OR 97401, 541-342-7576/541-221-3455 cell or by e-mail. Only you can make the choice it is time to get the process started.

FHA Refinance of Negative Equity Borrowers is a post from: FHA Loans Oregon

 Making Home Affordable Program

This is an enhancement to the existing Making Home Affordable Program (MHA) and should give a greater number of responsible borrowers an opportunity to remain in their homes. “These enhancements are designed to maintain homeownership by providing borrowers, who owe more on their mortgage than the value of their home, opportunities to refinance into an affordable FHA loan.” according to HUDs’ mortgagee letter 2010-23. “The opportunity allows borrowers who are current on their mortgage to qualify for an FHA refinance loan provided that the lender or investor writes off the unpaid principal balance of the original first lien mortgage by at least 10 percent.”

Who is helped?

The question that immediately came to my mind was, “Who will this help?” Answer, anyone that got a first and second to buy a home and haven’t been able to qualify for the Fannie Mae or Freddie Mac refinance programs due to the existence of the second mortgage. Rather than having to sell on a short sale, home owners may now get the same benefit and retain their home while getting into a lower cost FHA loan.

Fine Print

As with all things, these loans are not for everyone and not everyone will qualify. For example, the first mortgage has to be current and no behind in payments. The loan to value on the first mortgage can not be any higher than 96.5% based on current value. So, if you owe $300,000 on you home and it appraises at $250,000, you could get a loan for $241,250 and the lender would need to agree to write off $58,750 which would probably still net them more than a short sale or foreclosure would.

But if there is a second in place and they won’t negotiate balance, there could be some difficulty. In a case where there is a second involved that was used to purchase the home, the maximum CLTV (combined loan to value) is 115%, “Non-extinguished existing subordinate mortgages must be re-subordinated and the new loan may not have a combined loan-to-value ratio greater than 115 percent.”

The home owner must still qualify for the new loan, but there may be some latitude on credit scores, but that will depend on the lender’s overlays. These enhancements are effective for loans with case numbers issued on or after September 7, 2010, which are closed on or before December 31, 2012.. These enhancements include loss coverage to be provided from funds under the Emergency Economic Stabilization Act of 2008, as amended (EESA). If the availability of such coverage is delayed beyond September 7, 2010, implementation of these enhancements will also be delayed.

If you have tried to take advantage of current low rates to refinance but haven’t been able to do so because of negative equity, they may be an ideal solution for you. The roll out of the program is less than a month away and negotiations are going to need to be done with the lien holders, so it is not too soon to start planning for the program.

Contact me

Navigating the mortgage approval process can be daunting. You need someone on your side. I am available right now to help you with the loan process and know the ins and outs of FHA, VA, USDA and conventional financing. If you want to buy a home using an FHA loan or refinance using VA, I am here to help. Contact me at Alpine Mortgage Planning, 1200 Executive Pkwy., Ste. 100, Eugene OR 97401, 541-342-7576/541-221-3455 cell or by e-mail. Only you can make the choice it is time to get the process started.

HUD offers help to “certain” underwater home owners is a post from: FHA Loans Oregon