In a time when one might assume that their bank would work with them to refinance their home, many Washington homeowners are finding quite the opposite. I’m hearing from local homeowners who have made their mortgage payments on time and who qualify for refinance (income, employment and assets) yet their bank is either unwilling to provide the refinance or is taking several months to close it. [Read more…]
Refinancing isn’t just about lowering your rate — it’s about improving your overall financial strategy.
In this section, you’ll find educational resources explaining when refinancing makes sense, when it doesn’t, and how to evaluate your break-even point. Whether you’re considering a rate-and-term refinance, cash-out refinance, HELOC, renovation mortgage, or reverse mortgage, understanding the numbers and long-term impact is critical.
Topics covered include:
- “Should I refinance?” scenarios
- Cash-out strategies for remodeling or debt consolidation
- Home equity planning
- Recasting and re-amortization
- Renovation loans and ADU financing
- Refinancing with a second mortgage
My approach is always low-pressure and analytical — we look at the math, your goals, and your timeline before making any decisions.
If you’re a homeowner in Washington State wondering whether refinancing could improve your situation, start here.
Has your Bank turned down your refi?
July 5, 2012 by 1 Comment
Banks playing hardball with FHA Streamline Refi’s: ACT NOW!!
June 18, 2012 by 3 Comments
No sooner had the reduced MI gone into effect with FHA streamline refinances, some banks announced that they would only provide FHA streamline refinances on mortgages they currently service. I can understand a bank doing this on the “non-credit qualifying” refinances where borrowers do not document their income or assets, however I have a hard time accepting this when a borrower is doing a full “credit qualifying” FHA streamlined refinance.
By limiting availability of a program to home owners who are ABLE AND WANT to continue to make their mortgage payments and take advantage of the historically low mortgage rates, these banks are hampering the recovery of our housing markets.
Wells Fargo, with a significant market-share of FHA insured loans, was the first bank to come out with this announcement. If you have an FHA mortgage with Wells Fargo, I can help still you with your refinance if your home is located in Washington. I just have to keep your new FHA loan with Wells Fargo. Other banks have followed suit with a few giving us deadlines of up to this Friday, June 22, 2012 for accepting FHA streamline loans they do not service.
UPDATE: Received a notice of one bank adding a price hit for FHA streamlined refinances… somehow I don’t think HUD invisioned banks cherry picking and charging more for this program when HUD reduced the mortgage insurance premiums.
I continue to get announcements from the various banks and lenders we work with. Thankfully not all banks are following Wells Fargo’s suit.
BOTTOM LINE: if you have an FHA mortgage and are interested in an FHA streamlined refinance, please don’t delay! Banks are making them less available.
If your home is located anywhere in Washington state, I can help you with your FHA insured loan. We are *currently* working with lenders who will accept FHA loans currently being serviced from other banks. Click here to apply.
FHA Streamlined Refi Revamped and Revisited
June 14, 2012 by Leave a Comment
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…]
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.
FHA to Reduce Mortgage Insurance Rates for some FHA Streamlined Refi’s
March 6, 2012 by 1 Comment
Today HUD announced that beginning June 11, 2012, FHA will REDUCE the cost for an FHA streamlined refinance for FHA insured mortgages that were originated prior to June 1, 2009. A mortgagee letter will follow to make the following changes official:
Upfront mortgage insurance (UFMIP) will be reduced to 0.01% (from 1.00%).
Annual mortgage insurance (typically paid monthly) will be reduced to 0.55% (cut in half from 1.10%).
This is great news to those who originated their FHA loans prior to June 1, 2009. Once I receive the mortgagee letter from HUD, I'll be sure to update you. We'll need clarification on how HUD defines "origination". UPDATE: FHA's Mortgagee Letter clarifies that loans must be "endorsed" by HUD prior to June 1, 2009. This is different than your closing date and typically takes place weeks after closing.
FHA streamlined mortgages are popular right now considering today's low mortgage rates and that they do not require an appraisal.
Currently, a Seattle area home owner doing an FHA streamlined refinance with a loan amount of $400,000 and credit scores of 720 or higher would have a rate of 3.750% (apr 4.449) with a principal, interest and mortgage insurance (PIMI) payment of $2,234.59. With the proposed reduced FHA mortgage insurance, assuming the home owner originated their FHA loan prior to June 1, 2009, their PIMI payment would be $2,034.45 (apr 4.071): a difference of $200 per month!
If you would like more information about refinancing your FHA insured mortgage for your home located anywhere in Washington, please contact me. I have been originating FHA insured mortgages for Washington home owners since April 2000 at Mortgage Master Service Corporation and I'm happy to help you.
