Archive for Home Refinancing News
Streamline Refinance the Best Kept Secret in the Mortgage Industry
Posted by: | CommentsOnly a small percentage of loan professionals understand the streamline refinance guidelines and therefore there is a lot of misinformation about the VA and FHA streamline. Streamline rates range from 3.75% to 4.375%, so if you like cheap money with low mortgage rates, the streamline refinance is worth considering.
Loan originators are always looking for lending loopholes that will give them an edge over their competition’s loan programs. With only a few loan programs in today’s tight lending environment it can get frustrating for loan companies to carve out a niche. As with many industries, knowledge is power and loan officers that learn their guidelines backwards and forwards for VA and FHA loan programs truly are a few steps ahead of their competition. Not only does loan product knowledge earn you credibility with your borrower, but it actually enables you to get your clients qualified for a loan they would normally not be eligible for. Both VA and FHA mortgages have a loophole with the streamline refinance. If your clients already have a FHA or VA mortgage and they are having trouble qualifying for conventional refinancing because of credit, equity or income, then the streamline loan program may be the solution your client needs to qualify for a house refinance that saves them money while protecting them from foreclosure.
Streamline Refinance Great Solution for Qualifying VA and FHA Borrowers
FHA and VA home loans do not have minimum credit scores requirements from the agencies however; most government lenders have instituted their own credit score minimum in an effort to ensure the mortgage originated can be insured. The streamline refinance programs are available with both government loan products VA and FHA. To qualify for a streamline refinance, borrowers must already have a government mortgage (FHA or VA mortgage) and are seeking a rate and term refinance. Many of the VA mortgage lenders today have extended a unique refinancing opportunity with the VA streamline that require no minimum credit score.
Streamline Refinance Loan Highlights
- No Minimum Credit Score with FHA Streamlines
- VA Streamline Refinance with No Credit Score Requirements
- 12 Month Mortgage History is required.
- No Income Verification with Streamlines
- Skip Mortgage Payments when Streamline Refinancing
Refinancing Your Mortgage in this Economy
Posted by: | CommentsWhen rates are at record lows, refinancing your mortgage is likely a wise decision. The process for mortgage loan refinancing has been automated in recent years, however meeting the refinance guidelines has proved to be challenging for most homeowners in 2010. Do you qualify for the best mortgage refinance programs? Does your current mortgage have a pre-payment penalty for early pay off or refinancing? Does your credit score meet the lender requirements for home refinancing? These are all important questions to consider prior to shopping for a refinance loan.
Another reality is that mortgage refinancing with bad credit is very difficult. However both VA and FHA refinance loans are possible for borrowers that can demonstrate strong compensating factors. Many borrowers have strayed away from conventional loans in favor of FHA mortgage refinance solutions.
Mortgage Loan Refinancing Activity Rises 17%
The Mortgage Bankers Association reported yesterday that while interest rates remained the same this past week, home refinancing activity spiked up 17%. With the housing market stalled, nearly all the action in the mortgage market is in refinancing. Less than 20% of mortgage applications were for home purchases, for the week ending August 13the, the MBA reported. The survey covers more than half of U.S. retail residential mortgage applications.
Last week, the Wall Street Journal reported that low home loan rates appeared to be stimulating a significant increase in home refinancing. Many insiders believe that reduced lending fees and no cost refinancing options may have played a role in the increased refinance applications online.
Relief for Refinancing with Short Refinance and Emergency Homeowner Loan Programs
Posted by: | CommentsHome loan relief is becoming more controversial as the Obama administration continues to make moves to forgive mortgage debt with short refinancing initiatives that will write-down home loans for homeowners that find themselves stuck with underwater mortgages. Republicans and Democrats alike are complaining that Obama is trying to buy votes with debt forgiveness.
With home mortgage rates at the lowest point since Freddie Mac began tracking interest rates, what more can the Federal Reserve do? The Fed has little power left to lift the economy out of its rut. Congress, with an election looming, has no appetite for more stimulus. Typically, the Fed can lower home loan rates in an effort to stimulate consumer spending in hopes that it will invigorate the economy. But the benchmark interest rate controlled by the Fed has been almost zero percent for more than a year now.
The Obama administration already funded the Home Affordable Refinance Program that enabled mortgage refinancing to 125% on select Fannie Mae and Freddie Mac mortgage portfolios in an effort to combat the highly deflated home values that have prevented many Americans from being approved to refinance into a more affordable fixed mortgage payment.
| Eligibility for the HARP home loan relief was difficult and not enough homeowners met the requirements set forth to refinance their underwater mortgages.In a recent article, Deutsche Bank indicated that there may be 20 million underwater mortgage loans that are outstanding by the end of 2011. This puts a significant amount of pressure on homeowners that are already struggling with high unemployment and tighter loan guidelines. |  |
Now the government has given HUD the authority to approve an FHA short refinance option that actually reduces the principal mortgage balances. FHA insures home mortgages, but the agency has nearly used their emergency loan reserves. Who do you think is paying for this? – - Yes the U.S. tax payers will be picking up the tab on this mortgage bail-out initiative as well. And if that’s not enough risk for the government, they also agreed to another mortgage relief initiative with the Emergency Homeowner Loan Program that is designed to help self-employed and un-employed homeowners for six months.
The Fed announced this week they it would use the proceeds from its huge portfolio of mortgage securities to buy government debt. The idea is to make cheap credit even more affordable, particularly for things like mortgage loans. The problem is that Americans who are worried about job stability, not to mention volatility in the stock market, don’t want to borrow. They saved 6.2% of their disposable income this spring.
Sure, the Federal Reserve still has options. It could launch another trillion-plus-dollar program to buy government debt or mortgage securities like it did when it was battling the recession and financial crisis. But the Fed is unlikely to commit that much money unless things get a lot worse. Plus there are risks. Regulators are resistant to push interest rates on low rate home loans because they don’t want to artificially jump-start the housing sector like what happened that inflated the housing bubble. The Fed could slash the rate it pays banks to zero in an effort to keep money parked there, a move aimed at getting banks to lend more, but banks are not exactly feeling cash-rich, either.
As reported previously, home mortgage rates have fallen to record lows. 15-year mortgage rates fell to 3.92 % this week and rates on 30-year mortgage loans were published at 4.44 %. Still, consumers aren’t in a mad rush to purchase homes and most homeowners are unable to meet the tighter guidelines for FHA refinancing. HUD is considering implementing a minimum credit score and FHA guidelines may start requiring these higher risk borrower to put as much as 10% up for down-payments in an effort to stem foreclosures and loan defaults. Many mortgage lenders believe that if the loan requirements were loosened for a period to get the distressed homeowners approved for refinance loans or loan modifications that our housing sectors will rebound locally and nationally.
Emergency Homeowner Loan Program
Posted by: | CommentsThe U.S. Department of Housing and Urban Development just confirmed that they will be launcing a new $1 billon mortgage relief program called the Emergency Homeowners Loan Program. The Obama administration has extended several mortgage bail-out programs for distressed homeowners like the Home Affordable Refinance Program, but very few borrowers were able to qualify for this relief measure that enabled homeowners that had mortgages owned by Fannie Mae or Freddie Mac the ability to refinance their under-water loans up to 125% loan to value.
Bill Apgar, HUD Senior Advisor for Mortgage Finance said today, “HUD’s new Emergency Homeowner Loan Program will build on Treasury’s Hardest Hit initiative by targeting assistance to struggling unemployed homeowners in other hard hit areas to help them avoid preventable foreclosures.” Apgar continued, “Together, these initiatives represent a combined $3 billion investment that will ultimately impact a broad group of struggling borrowers across the country and in doing so further contribute to the Administration’s efforts to stabilize housing markets and communities across the country.”
Emergency Homeowner Loan Program to Help Refinancing Under-Water Mortgages
The Obama Administration today announced additional support to help homeowners struggling with unemployment through two targeted foreclosure-prevention programs. Through the existing Housing Finance Agency (HFA) Innovation Fund for the Hardest Hit Housing Markets, the U.S. Department of the Treasury will make $2 billion of additional assistance available for HFA programs for homeowners unable to qualify for mortgage refinancing as well as struggling to make their home loan payments due to unemployment.
The Emergency Homeowner Loan Program will offer loan relief and assistance for up to 24 months to homeowners to struggling homeowners who are at risk of foreclosure. This finance relief program is targeting homeowners who have experienced a significant reduction in income due to involuntary unemployment, underemployment, or a medical condition. “We remain committed to helping struggling homeowners, and this program will provide additional assistance to states hit hardest by unemployment,” said Assistant Secretary for Financial Stability Herb Allison. “This is part of the Administration’s comprehensive housing policy that has helped to stabilize a fragile housing market and allows responsible homeowners the chance to reduce their monthly mortgage payments to affordable levels.”
President Obama first announced the Hardest Hit Fund in February 2010 to allow states hit hard by the economic downturn flexibility in determining how to design and implement programs to meet the local challenges homeowners in their state are facing. Under the additional assistance announced today, states eligible to receive support have all experienced an unemployment rate at or above the national average over the past 12 months. Each state will use the funds for targeted unemployment programs that provide temporary assistance to eligible homeowners to help them pay their mortgage loan while they seek re-employment, additional employment or undertake job training. States that do not currently have Hardest Hit Fund unemployment programs must submit proposals to Treasury by September 1, 2010 that, within established loan guidelines, meet the distinct needs of their state.
FHA Mortgage Refinance Solutions
Posted by: | CommentsMortgage interest rates have dropped to record lows for three weeks in a row. Unfortunately the benefits of low home loan rates are not able to be realized by a high percentage of homeowners because they do not meet the current mortgage refinance requirements. For the most part, today borrowers need higher credit scores and more home equity. For borrowers who have the credit but not enough equity, Mortgage Refinancing Buzz recommends considering a FHA refinance loan. Many borrowers are migrating from a conventional mortgage to an FHA mortgage, because the conventional guidelines restrict rate and term refinancing between 80 and 90%. FHA loans do have a small mortgage insurance payment in addition to the mortgage payment, but FHA mortgage rates are just as low as the conventional rates.
FHA Mortgage Rates Are Prime for Mortgage Refinancing
FHA loan programs remain more flexible than conforming home loans because the conventional guidelines have been tightened significantly more for borrowers seeking low rate mortgage refinancing solutions. FHA approves mortgage refinancing of up to 97.5% loan-to-value for qualified borrowers. With FHA refinancing, borrowers must always document their income, but these days’ conventional loan programs have eliminated stated income and no income refinancing programs any way.
Top 5 Mortgage Refinance Loans in 2010
Posted by: | Comments2010 has been an interesting year for mortgage refinancing for both homeowners and lending professionals. Qualifying for a refinance loan has certainly been an easier process in years past. Since the subprime mortgage crash of 2006, the mortgage industry has transformed mortgage refinance programs to reduce risk and decrease foreclosure rates.
Mortgage refinance rates are at record lows and homeowners that do qualify can benefit from a fixed rate mortgage that will reduce their monthly payment and eliminate years of compounding interest. There is also an opportunity for millions of homeowners to escape the fear of their adjustable rate home loans. Al Pereida, the branch manager for iServe Lending in Irvine, California said, “Homeowners should not pass up these opportunities to lock in fixed rate mortgages below 5%.”
Listed below are the Top 5 Mortgage Refinance Loans in 2010:
1. FHA Refinance Loan – This is the most common refinance loan for homeowners this year, because FHA doesn’t require much equity and the credit score requirements are not as stringent as conventional lending guidelines. Low credit scores and lack of equity are the biggest obstacles for homeowners in this market.
2. VA Streamline Refinance – This is the most cost effective refinance loan available this year, but you must have VA loan eligibility. The VA refinance overlooks the lack of equity because there is no appraisal needed for the VA streamline program.
3. No Cost Mortgage Refinance – Refinancing into a low rate mortgage with no points and no fees is a great option for borrowers with good credit scores and worthy income documentation.
4. Loan Modification – This is technically not a refinance loan, but it accomplishes the same goal of achieving a lower monthly payment. Millions of distressed homeowners find themselves being rejected by lenders because they do not meet the tighter mortgage refinance guidelines.
5. Cash Out Refinance – Home equity loans have nearly vanished so the cash out refinance has remained a popular choice for home improvement financing and debt consolidation. FHA refinance loans allow 85% cash out. VA refinancing guidelines allow 90% cash out and most conventional lenders limit cash out to 80%.
Best Mortgage Refinance Programs
Posted by: | Comments2010 has been a great year for mortgage refinance rates! Sure lenders and banks have tightened their guidelines but home refinancing rates have fallen to record lows. If you qualify you will be rewarded with a lower mortgage rate, a reduced monthly payment and better fixed rate terms. If you need a stated income refinance, chances are you will need to wait for lenders to release new refinance programs.
Below, we listed the best mortgage refinance loans so you can have a better idea on what is out there before you begin shopping lenders online:
FHA Mortgage Refinance – The most popular refinance loan this year because it is flexible with credit and not much equity is required. The FHA streamline does not allow you to finance closing costs anymore, so we suggest sticking with the traditional FHA refinance loan because rates are available below 5% with no pre-payment penalties. FHA allows cash out to 85% loan-to-value.
Conventional Refinance – This is a great refinance loan for borrowers with credit scores above 700 and at least 20% home equity. There is no private mortgage insurance like FHA loans, so you will get the best of both worlds. Most conventional lenders will allow cash refinancing to 80% LTV.
VA Mortgage Refinance – If you are active in the Military or a retired veteran you will love the VA refinance opportunities. VA offers the VA streamline refinance that allows borrowers who already have a VA mortgage to refinance with reduced lending fees. No appraisal is required, so you save money and do not need to have any equity. No other lending program allows you to go above 100% loan to value and required no appraisal. VA enables cash out refinancing to 90%. The VA mortgage refinance program will even allow you to skip a payment.
Whichever mortgage refinance loan you choose, know that you are locking into the lowest fixed rates seen in a generation. Contact Nationwide for a free rate quote and refinance analysis with no obligation.