FHA & FHA STREAMLINE

FHA

An FHA Loan is a mortgage that’s insured by the Federal Housing Administration. They allow borrowers to finance homes with down payments as low as 3.5%. FHA mortgages are a great option for homebuyers looking for a mortgage program with lower down payment options and flexible qualifying guidelines.

Borrower Benefits and Program Details

• Borrower is not required to be a first time buyer
• Available for purchase or refinance
• 5% down payments
• Primary Residences, 1-4 units, Condos and Planned Unit Developments
• Minimum FICO score of 580 (exceptions made for lower scores)
• Can have less than perfect credit
• Cash for down payment and closing costs can come from multiple sources, including gifts, grants, and Community Seconds, with NO minimum personal funds required
• Non-occupant borrowers permitted
• No Income Limits
• FHA Loans are assumable
• Qualify easier with lower underwriting standards
• Seasoning requirements for derogatory events are less stringent
• Allows for higher debt to income ratios which allow you to qualify for a larger loan amount
• Higher Seller Contributions allowing for a greater portion of your closing costs to be covered in the transaction

Disadvantages of an FHA Loan:

• FHA has loan limits for each county so you are capped at loan amount
• Mortgage Insurance is for the life of the loan (or you can refinance to get out of it)
• Upfront mortgage insurance premium (which gets rolled into the loan)

FHA Streamline

The FHA Streamline Refinance is a special mortgage product, reserved for homeowners with existing FHA mortgages. FHA Streamline Refinances are the fastest, simplest way for FHA-insured homeowners to refinance their respective mortgages into today’s mortgage rates.

Borrower Benefits and Program Details

• Flexible Requirements
• No Appraisal Needed
• Underwriting process typically takes less time
• Lower interest rates
• Not as much documentation required

It is important to remember that the FHA Streamline Refinance loans aren’t the same as cash-out refinancing programs, and you won’t get any more than up to $500 cash. The main benefit with Streamline FHA-guaranteed loans is that your monthly payments are permanently lowered. The extra money you have at the end of the month can go a long way toward helping you reach your financial goals.