There is a lot of interest in the FHA streamlined refinance since HUD has greatly reduced the mortgage insurance premiums for some home owners who originated their existing FHA mortgage May 2009 and earlier. FHA streamlined refinances are designed to reduce mortgage payments and borrowers are not allowed to take “cash out” or pay off existing helocs or second mortgages. In order to qualify for an FHA streamlined refiance, the borrower must have made at least six payments on the FHA loan and needs to be current with the mortgage. Here are a few tips on FHA streamlined refinances I thought I’d share with you. [Read more…]
Mortgage Programs
Not all mortgage loans are the same — and choosing the right program can make a significant difference in your payment, qualification, and long-term financial flexibility.
This section covers the most common and specialty mortgage programs available to homebuyers and homeowners, including:
- FHA Loans
- VA Loans
- USDA Loans
- Conventional & Jumbo Loans
- HomeReady & Home Possible
- Down payment assistance programs
- Washington State Housing Finance Commission (WSHFC) programs
- Specialty programs for medical professionals and unique scenarios
Understanding eligibility guidelines, loan limits, credit requirements, and program benefits allows you to compare options strategically rather than relying on headlines or general advice.
As a Mortgage Advisor with over 25 years of experience, I help clients evaluate which program best aligns with their income, assets, and long-term plans.
Explore the programs below to better understand your options.
Just one more week for higher and lower FHA mortgage insurance premiums
June 4, 2012 by Leave a Comment
A week from today, on June 11, 2012, HUD has more changes scheduled for FHA mortgage insurance premiums. I've been sharing this news with you here on my blog.
Let's start with the higher premiums. If you are considering an FHA high balance (also known as an FHA jumbo) mortgage, if possible, you want to obtain your FHA case number as soon as possible. Starting next week, effective on case numbers obtained on or after June 11, 2012, FHA annual mortgage insurance premiums for high balance loans will go up an additional 0.25%. FHA annual mortgage insurance is paid monthly.
In the greater Seattle area, this will impact FHA loans from $417,001 to $567,500.
I have more about the increase to the FHA mortgage insurance premiums on this earlier post.
If you are buying a home with utilizing an FHA insured mortgage – make sure you get your case number pronto. This also implies to you if you're doing a rate-term FHA refinance (not an FHA streamline) or an FHA streamline refinance that was endorsed after June 1, 2009.
This is a good segue to the reduced premiums that take effect next week…
HUD has dramatically reduced FHA mortgage insurance premiums on loans that were endorsed prior to June 1, 2009. An FHA mortgage is "endorsed" after closing – sometimes many weeks after. It's possible your FHA mortgage closed in May 2009 and was not endorsed until after June 1, 2009, in which case, your loan would not qualify for the reduced mortgage insurance premiums.
If your FHA mortgage was endorsed prior to June 1, 2009, your eligible for greatly reduced MI rates. HUD has reduced the upfront mortgage insurance premium to 0.01% and the annual mortgage insurance premium to 0.55%. It's a significant savings, especially when you factor in today's extremely low mortgage rates.
The reduced FHA mortgage insurance premiums are available for FHA streamlined refinances with case numbers obtained on or after June 11, 2012. Guess what? You do not need to wait until June 11, 2012 to start your FHA streamlined refinance. We are accepting mortgage applications now for FHA streamlined refinances as long as your home is located in Washington state. FHA streamlined refinances do not require an appraisal so it's okay if your home has lost value.
I have been originating FHA loans since April 2000 at Mortgage Master Service Corporation. If your home is located in Washington State, I'm happy to help you with your mortgage. Click here if you would like me to provide you with a mortgage rate quote for your Washington home.
Don’t Delay: FHA Mortgage Insurance set to increase (again) for FHA Jumbos on June 11, 2012
May 15, 2012 by Leave a Comment
Last month, HUD increased FHA mortgage insurance rates on both upfront and annual (paid monthly) premiums. Borrowers who are considering an FHA high balance (aka FHA jumbo) loan amount, will see another increase to FHA mortgage insurance next month.
Effective on case numbers issued on or after June 11, 2012, FHA annual mortgage insurance premiums for "high balance" FHA loan amounts by 0.25 bps. In the greater Seattle area (King, Snohomish and Pierce counties), this impacts loan amounts between $417,001 to $567,500 for 1-unit properties.
Currently, FHA high balance mortgages have annual insurance premiums per the table below.
Effective with FHA case numbers issued June 11, 2012 and later, the annual mortgage insurance premium for FHA jumbos will look like this:
Term greater than 15 years
- LTV equal or less than 95% = 145 bps
- LTV greater than 95% = 150 bps
Term 15 years or less with LTV above 78%
- LTV equal or less than 90% = 60 bps
- LTV greater than 90% = 85 bps
FHA annual mortgage insurance is paid monthly. To determine how much the annual mortgage insurance will impact your monthly mortgage payment, multiply the base loan amount by the bps.
Today, a Seattle home with a 95% LTV and an FHA Jumbo 30 year fixed with a base loan amount of $560,000 would have an a monthly mortgage insurance of $583.00 (560,000 x 1.25% = 7,000 divided by 12 months = 583.33).
With FHA Case numbers issued as of June 11, 2012 or later, the same Seattle home will have a $116.67 higher monthly mortgage premium. (560,000 x 1.50% = 8,400 divided by 12 months = $700.00 per month).
If you are considering an FHA Streamline refi in the greater Seattle area (King, Pierce or Snohomish counties) and your loan amount is $417,001 to $567,500 and you obtained your FHA loan after May 2009, you may want to start your refi now! NOTE: If your existing FHA mortgage was endorsed by HUD prior to June 1, 2009, you qualify for reduced FHA mortgage insurance premiums. If you would like a rate quote, click here.
If you are considering buying a home or are in contract to buy a home and you have an FHA jumbo, make sure your mortgage professional obtains your FHA case number prior to June 11, 2012.
I'm happy to help you with your FHA mortgage if your home is located any where in the state Washington.
FHA Underwriting Guidelines Tightening
April 13, 2012 by 2 Comments
UPDATE 6/19/2012: HUD has rescinded some of the guidelines issued in this Mortgagee Letter. Specifically those addressing collections and disputed accounts.
In late February, HUD released Mortgagee Letter 2012-3 with tougher guidelines for self-employed borrowers, disputed accounts and collections. Over the weekend, HUD amended the guidelines to have the disputed accounts and collections go into effect on July 1, 2012. However the new guidelines for self employed borrowers went into effect for case numbers as of April 1, 2012.
Here is a quick(?) 4-1-1 of the new guidelines: [Read more…]
You Don’t Have to Wait Until June to Start Your FHA Streamlined Refi
April 11, 2012 by Leave a Comment
If you currently have an FHA insured mortgage that was *guaranteed* prior to June 1, 2009, you may qualify for significantly reduced mortgage insurance premiums with an FHA streamlined refinance. Effective June 11, 2012, HUD will offer the reduced premiums for those who meet HUD’s criteria. The good news is, if you qualify for the reduced premiums, you don’t have to wait to lock in today’s low rates – just do a longer lock!
Why HUD, in all their wisdom, used the date an FHA loan was guaranteed beats the heck out of me. This has nothing to do with when your FHA mortgage closed; it’s when HUD has insured the loan which often takes place weeks or even a few months after closing.
If you have been considering refinancing your FHA mortgage with an FHA streamlined refi, and you closed on your last FHA mortgage prior to June 1, 2009, you may want to check with a local lender to see when your current mortgage was endorsed.
If you’re one of the lucky ones, you can actually start your application now (click here to apply on line if your home is located in Washington) and wait until June 11, 2012 to order your FHA case number. We can also watch rates to determine when to lock. The longer the lock period, the more the rate cost. You can see by the rates posted below – locking now with an extended lock period looks pretty good!
Here’s are some scenario’s for FHA streamlined refinances based on rates as of the writing of the post (4/11/2012 12:45pm PST) and the borrower having mid-credit scores of 720 or higher in greater Seattle:
Base loan amount of $400,000 for a 30 year fixed rate mortgage:
FHA Streamlined Refi with existing mortgage NOT qualifying for the reduced mortgage insurance premiums (mortgage not guaranteed by May 31, 2009 or sooner by HUD):
3.750% (apr 4.743%) with a PIMI (principal, interest and mortgage insurance) payment of $2,298.06.
FHA Streamlined refi (existing mortgage was guaranteed by HUD prior to June 1, 2009) with closing by June 18, 2012 (long enough time period to obtain the reduced mortgage insurance premiums):
3.750% (apr 4.141) PIMI payment of $2,034.45. You don’t have to wait to lock in today’s low rates! This pricing is based on a 75 day lock – or you can start the process and lock in at anytime you choose as long as the lock period is beyond June 11, 2012.
This is especially huge for FHA Jumbo’s which are really being hit hard with the higher FHA mortgage insurance premiums. In the greater Seattle area, this impacts FHA loans with a base loan amount of $417,001 to $567,500.
Here’s how the payments compare for an FHA Jumbo with a base loan amount of $565,000 and 720 mid-credit scores:
FHA Jumbo Streamlined refi where existing mortgage was guaranteed June 1, 2009 or later:
3.750% (apr 4.589) with a PIMI payment of $3,222.66.
NOTE: FHA annual mortgage insurance will increase again for high balance/jumbo FHA loans by an additional 0.25% effective June 11, 2012. This increase would cause our above scenario (if they waited until June 11, 2012 to get their case number) to have a PIMI of $3,339.38 (apr 4.732). If you fall into this category: FHA high balance (aka jumbo) guaranteed after May 31, 2009, you will want to obtain your FHA case number BEFORE June 11, 2012.
FHA Jumbo Streamlined refinance where the existing FHA mortgage was guaranteed May 31, 2009 or sooner priced with a 75 day lock to close after the FHA case number is obtained on June 11, 2012:
3.875% (apr 4.214) with a PIMI payment of 2,913.94.
Another reason to consider starting your application now is that it will allow you have time to review your credit. There may be small adjustments you can make that will improve your credit score and quite possibly your interest rate – the point is, you have some time to check it out and make sure you’re in the best position prior to closing.
If your home is located anywhere in Washington state, and you’re considering an FHA streamlined (or any type of) refi, I’m happy to help you!
You don’t have to wait to start your FHA streamlined refi and gamble rates going higher, unless you want to.
