Mortgages Made Simple with Rick Gundzik

Thursday, October 1, 2009
The State of the FHA Streamline Program
Today we welcome a guest blogger... Brandon Laughridge from MortgageLoanPlace.com Mortgages Made Simple logo

Mortgage refinance applications continue to pour in nationwide as homeowners look to take advantage of falling rates.

As a whole, mortgage applications in mid-September hit their highest level since May, with refinancing applications increasing 17 percent from the week prior, according to data from the Mortgage Bankers Association.

"The steady improvement in housing is continuing," Joel Naroff, chief economist at Naroff Economic Advisors Inc., told Bloomberg News after the MBA figures were released. "This sector is likely to start adding to growth rather than holding back the economy."

The MBA's index of applications rose 13 percent for the week ending Sept. 18. The association's refinance index jumped almost 23 percent, the largest single jump since March.

With interest rates now hovering near 5 percent, there's no better time to consider a refinance. That's especially true for FHA loan recipients, who can take advantage of one of the most flexible and economically efficient refinance programs on the market.

The Federal Housing Administration administers several refinance options. Borrowers can get a cash-out refinancing, although this option is typically geared toward those whose properties boast significant equity and rising market value.

A more common and popular approach is the FHA's streamline program, which has helped thousands of Americans refinance during the last 20 years.

The program has a few basic criteria:
  • You must have an FHA mortgage
  • You must be current on your mortgage
  • The refinance must lower the monthly principal and interest payments
  • You cannot receive cash

Some qualified borrowers can obtain no-cost refinances. In some cases, closing costs can be rolled into the cost of the refinance.

Borrowers can get a streamline loan without getting their home appraised, but remember that the refinance cannot be for more than the original loan.

This article was written by Brandon Laughridge of Mortgage Loan Place. Learn more about FHA Loan Requirements and FHA vs. Conventional Loans at MLP today!

If you have any questions you would like us to answer on our show, please call our listener line at 714-519-7833 or email mortgagepodcast@gmail.com.

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