If you’re on the market for refinancing your loan, then you may have been looking at all the options that are available to you.
If you already have an FHA loan, then you might consider the San Diego Streamline Refinance mortgage loan that is offered by the FHA.
This process is quick and relatively painless for those that are interested.
Extremely Easy To Qualify
If you’re looking into an FHA streamline refinance, then the first thing that you need to know about the process is that it isn’t difficult to qualify for the refinance.
Even when compared to the qualifying process for an FHA loan, this process is quite simple.
There are few people that wouldn’t be able to qualify for this refinance plan.
Few Requirements Before Refinancing
The only things that you need to submit are a three-month payment history and a good reason for refinancing your loan.
The payment history ensures that the loan is current and that you aren’t trying to refinance a delinquent loan.
As for why you need a reason to refinance, you need to experience an actual benefit for the lender to consider the refinance.
If you try to refinance and your rate wouldn’t change that much (if at all), then your lender will tell you that you cannot refinance.
Once the rates have changed enough, then you will find that the refinance is better worth it for you and for the lender.
Quicker Process Than Normal Refinancing
In a traditional refinancing situation, you will have to go through several steps to refinance.
Not only will this involve looking at rates but it will also involve appraising your house again.
There may be more paperwork than you really want to deal with.
A streamline refinancing requires no appraisal, no credit check, and no employment check.
This means that you won’t have to spend your valuable time and money trying to deal with paperwork and appraisals to show just how much your house is actually worth.
Just like with a conventional loan, you will be able to renegotiate the terms and rates of your loan.
But the bonus of the streamline is that it can occur fairly quickly at a time that you need it.
You won’t start your refinance and have to wait for the process to be complete.
Once you have figured out an end date, then there won’t be much in your way to paying less every month.
210 Day Period Before Refinancing Again
When you refinance your loan, you may find that shortly afterward you will see a better rate or a better way to do your loan.
However, you have to wait 210 days before you are able to refinance your loan again with a streamline refinance.
This is to ensure that you make 6 regular payments with your loan after you close on the refinance again.
While this is annoying to someone that sees an opportunity that they can’t take advantage of, it is meant to protect the FHA and the lender that is associated with the loan.
Just like with a refinance, you have to take into account the closing costs that are associated with everything.
Part of the closing costs for a streamline refinance is wrapped up in the mortgage insurance premium that you have to pay up front.
There are ways to get around this with a refund that comes if you refinance your loan within 3 years.
However, you cannot use the loan balance to cover the closing costs for an FHA loan.
In some instances with a traditional loan, you can use your refinancing situation to get out of mortgage insurance.
Unfortunately for those that have an FHA loan, there is no way out of the mortgage insurance unless you meet the requirements set by the FHA.
These requirements involve the LTV ratio, but even then you will have to pay mortgage insurance premium for 11 years for a loan that has been made after 2009.
The more annoying part of the mortgage insurance is that you may have to make an upfront mortgage insurance payment again when closing on a refinancing.
There is a refund available if you refinance within 3 years.
The refund is still available after those three years, but the amount that it gives you goes down dramatically after that point.
Your Reason Has To Be Enough
If you’re trying to refinance your loan, then you will have to give a reason for doing it.
When your lender looks at your current payment and your potential payments, they will have to see a difference that will be made there.
The reason for this is to prevent people from trying to refinance and spend money on the refinance when they won’t be getting any benefit from the process.
You may find this annoying if you’re trying to hold onto as much money as possible, even if it is only a dollar or two more.
If you want to check on the rates of mortgages before you start thinking about refinancing, use my handy tool.
It’ll save you time and money if you’re in the market for a refinancing.
What do you think?
Leave a comment below - or, call/text me at (760) 297-4539
Your FHA Insider,