FHA Loans
(Federal Housing Administration)

FHA Loans

Rate and Term Refinance

  • Up to 96.50% LTV (Loan-to-Value)
  • 580 Minimum Credit Score
  • Loan Terms from 10 to 30 Years
  • 1.75% Upfront Mortgage Insurance Premium
  • Financed into Loan Amount
  • 0.55% Monthly Mortgage Insurance
  • Remains for Life of Loan (if LTV is > 90%)
  • $472,030 Maximum Loan Amount (Jefferson County)

Streamline Refinance

  • Existing FHA Mortgage Required
  • 580 Minimum Credit Score
  • No Income or Appraisal Needed
  • Loan Terms from 10 to 30 Years
  • 1.75% Upfront Mortgage Insurance Premium
  • Financed into Loan Amount
  • 0.55% Monthly Mortgage Insurance
  • Remains for Life of Loan (if LTV is > 90%)
  • $472,030 Maximum Loan Amount (Jefferson County)

Cash-Out Refinance

  • Up to 80.00% Loan-to-Value
  • 580 Minimum Credit Score
  • Loan Terms from 10 to 30 Years
  • 1.75% Upfront Mortgage Insurance Premium
  • Financed into Loan Amount
  • 0.50% Monthly Mortgage Insurance
  • Remains on Loan for 11 Years
  • $472,030 Maximum Loan Amount (Jefferson County)

FHA refinance loans are mortgage loans insured by the Federal Housing Administration (FHA) and designed for borrowers who already have an existing FHA loan. These loans allow borrowers to refinance their current FHA loan into a new loan with different terms or features.

Here are some key points about FHA refinance loans:

  1. Streamline Refinance: The most common type of FHA refinance loan is the FHA Streamline Refinance. This program is designed to simplify the refinance process and typically does not require a new appraisal or extensive documentation. It is available to borrowers with an existing FHA loan who want to reduce their interest rate or monthly mortgage payments.
  2. Cash-Out Refinance: FHA also offers a Cash-Out Refinance option, allowing borrowers to refinance their existing FHA loan and receive cash from the home's equity. The cash received can be used for various purposes, such as home improvements, debt consolidation, or other financial needs.
  3. Credit Requirements: FHA refinance loans generally have more lenient credit requirements compared to conventional loans. Borrowers with lower credit scores or less-established credit histories may still be eligible for an FHA refinance loan. However, individual lenders may have their own credit score requirements.
  4. Mortgage Insurance: FHA loans require upfront mortgage insurance premium (UFMIP) and annual mortgage insurance premium (MIP). When refinancing an FHA loan, you may be eligible for a refund of a portion of the UFMIP if you refinance within a certain time frame. The MIP on the new loan will depend on factors such as the loan-to-value ratio and loan term.
  5. Debt-to-Income Ratio: FHA refinance loans typically have more flexible debt-to-income (DTI) ratio requirements compared to conventional loans. However, lenders still evaluate your ability to afford the new loan payment based on your income and current debts.
  6. Closing Costs: Like any mortgage refinance, FHA refinance loans involve closing costs. These costs can include appraisal fees, title search fees, and other expenses. It's important to consider the closing costs when evaluating the financial benefits of refinancing.
  7. Documentation: While FHA Streamline Refinance loans generally require less documentation, you will still need to provide certain documents such as proof of income, employment verification, and bank statements. The exact documentation requirements may vary among lenders.

It's important to note that FHA refinance loans are only available for borrowers with an existing FHA loan. If you currently have a conventional loan or a loan backed by another government agency, such as a VA or USDA loan, you may need to explore other refinance options. Consulting with a lender or mortgage professional experienced in FHA loans can help you understand the specific requirements and benefits of an FHA refinance loan based on your individual circumstances.

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