Video: To Refinance Or Not To Refinance?
What is the FHA Streamline Refinance?
FHA Streamline refinances enable California homeowners to refinance their current FHA home loans with reduced paperwork and underwriting to take advantage of lower interest rates so that borrowers can save more money, lower their monthly housing payments and in some cases change from an adjustable rate mortgage to a fixed rate mortgage loan or even shorten the term of their loans.
This means less hassle, less paper, faster processing and potentially huge savings over the life of your loan.
Here are many advantages for California property owners, including the availability of ‘no-cost’ refinances and even those who didn’t qualify before might qualify now.
What Are the New Changes That Make FHA Streamline Loans Even Better?
These home loans have been available for years. Unfortunately, recent increases to mortgage insurance (MI) premiums often wiped out the savings for those refinancing.
At least until now…
Homeownership has become more affordable for millions of Americans. HUD has drastically cut the mortgage insurance premiums that new borrowers will pay. Insurance premiums on FHA-backed mortgages jumped to 1.35% since 2010. This priced many creditworthy borrowers out of the housing market.
The Obama administration announced a .50% rate drop which was projected to enable 250,000 new first-time homebuyers to get FHA loans over the next three years. At this time, approximately 800,000 households use FHA annually. The change took effect 01/26/2015
Julián Castro, Secretary of the Department of Housing and Urban Development (HUD), said the rate drop will save the average borrower $900 annually. "Since 2009, the Obama Administration has taken bold steps to reduce risks in the mortgage market and to protect consumers. These efforts have made it possible to take this prudent measure while also ensuring FHA remains on a positive financial trajectory. By bringing our premiums down, we’re helping folks lift themselves up so they can open new doors of opportunity and strengthen their financial futures."