The home refinancing market has been on a roller coaster the last few years, but 2011 could shape up and more borrowers could qualify to refinance than did in the last few years.  I get a lot of emails from homeowners asking me for home refinancing tips so I wanted to make some suggestions. 

1. Take advantage of VA refinancing if you qualify for the VA loan programs.  Veterans continue to have a significant advantage when it comes to home buying and mortgage refinancing. The VA refinance loans are more aggressive than conventional and FHA lending so take advantage of this great resource.

2.  Streamline Refinance if you have a government loan. If you are having difficulty getting approved for a refinance loan because of income documentation because you your debt to income ratio is too high and you presently have a government mortgage like a VA or FHA , then consider the streamline refinance.  Both the VA and FHA loan programs offer the streamline refinance loan that does not require pay stubs or W2′s for salaried and hourly employees. You still have a job, because the lender will verify with your employer that you still have a job. Government insured home refinancing continues to dominate the finance market in 2011.

3.  5/1 ARM offers low rates that maximize affordability.  If you are having trouble fitting your mortgage payment into your budget and you want to keep your house, consider the 5/1 because you get a 3% rate fixed for 5 years.  This gives you another five years to increase your income before you lock into a 15 or 30-year fixed rate mortgage. For example a $300,000 mortgage payment would be in the $1,000 a month range with the 5/1 ARM at 3%.

4.  Don’t rule out a mortgage loan modification.  If you have been late on your home loan payments or you have been unable to get approved for a bad credit mortgage because of poor fico scores, consider a loan modification or forbearance from your lender.  Many loan companies are extending modifications to borrowers if they can demonstrate that they have the ability to make the reduced mortgage payment.

5.  Re-Apply for a refinance loan. Many borrowers were turned down for a refinance loan in 2010, but that doesn’t mean they won’t qualify to refinance in 2011.  Many loan professionals anticipate that some of the home refinancing programs will be more flexible with credit guidelines.