FHA Loan Articles
News, updates, and explanations to keep you informed.
Maximum Loan Amounts for VA Streamline Refinancing
You might not apply for a new purchase VA mortgage loan thinking about the day you might want to try refinancing the mortgage, but in tough economic times, many homeowners begin thinking about a VA Streamline Refinancing Loan, and rightfully so. VA Streamline Refinancing Loans can lower interest rates and monthly mortgage payments and are a good way to improve your bottom line.
Did you know the VA Streamline Loan program actually requires payments to be lowered or provide an alternative "net tangible benefit" to the borrower?
Naturally one of the first questions a VA borrower wants to know is how much the maximum loan amount on a VA Streamline is; according to the VA Lender's Guide, most VA home loans are limited to "the amount of the loan to the reasonable value of the property shown on the Notice Of Value plus the cost of energy efficiency improvements up to $6,000 plus the VA funding fee".
But when it comes to a VA Streamline Refinancing or Interest Rate Reduction Refinancing Loan, the VA loan limit includes the VA loan balance on the current mortgage, plus "the cost of any energy efficiency improvements up to $6,000, allowable fees and charges, up to two discount points, plus the VA funding fee." These are items that can increase the maximum streamline loan amount available to you because of the add-ons to the loan.
All of those options are allowed, but after careful consideration, some borrowers choose not to include the VA loan funding fee and discount points into their refinancing loan. This is a smart choice in many cases because of the rule which states that a VA Streamline Loan must include a credit check when the monthly payment increases by more than 20%.
The more extras like the VA loan funding fee or discount points a borrower wants to roll into a VA Streamline Loan, the closer a borrower may be to needing to apply for a credit-qualifying Streamline Refinance loan instead. It's important to evaluate how much your extras rolled into the loan will add to the mortgage payments and the overall cost of the VA refinancing loan.
FHA NEWS and RELATED ARTICLES
One type of question that sometimes arises about FHA loans-- Is there a no-credit-check version of an FHA mortgage loan? What is the criteria required for FHA loans that do not require a credit check and/or appraisal?
One not-so-common question about FHA loans still comes up often enough to discuss in detail. Some FHA loan applicants want to know if they can purchase a residence from another family member using an FHA insured mortgage.
Except for obligations specifically excluded by state law, the debts of the non-purchasing spouse must be included in the borrower’s qualifying ratios if certain conditions are met.
Some FHA borrowers have questions about applying for an FHA loan after experiencing a short sale on a previous home. The FHA loan rules found in HUD 4155.1 have the answers for borrowers applying for an FHA mortgage after a short sale.
The FHA and HUD issued new rules for mortgage insurance designed to add fiscal security to the loan program, and when those rule changed the new guidelines were published in Mortgagee Letter 2013-04.