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The FHA refinancing option is considered streamlined because it allows you to reduce the interest rate on your current home loan quickly, sometimes without an appraisal.

FHA Rates Near 50 Year Low!

Now is the time to drop the interest rate on your 30-year mortgage or refinance into a 15-year home loan.

FHA Rates for October 29, 2020
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FHA.com is a privately owned website, is not a government agency, and does not make loans.

FHA Simple Refinance

Sometimes It Pays to Refinance

The FHA Simple Refinance allows homeowners to go from their current FHA Loan into a new one, whether it's a fixed-rate loan or an ARM. This refinance is the most straightforward, and there is no option for cash-out.

With the Simple FHA Refinance, lenders will require a credit qualification, which is the process of analyzing credit, income, and assets to ensure the borrower meets the requirements for the new loan terms. There is also a home appraisal, to see how much the house has increased in value. This loan can include all of your closing costs and prepaid items in the loan amount, as long as the amount falls within the appraised value; up to 97.75 percent loan-to-value.

Simple Refinance vs. Streamline Refinance

Many borrowers wonder about the benefits of an FHA Simple Refinance when compared to the Streamline Refinance. Why go through the credit qualification process when you can avoid the hassle? Both types of refinances can benefit a borrower depending on the situation. The Streamline is a good option when refinancing homes that have not risen much in value, or if you're planning to sell your home soon, so you want to avoid adding closing costs to your principal. The FHA Simple Refinance allows you to keep your out-of-pocket costs very low, and possibly get much lower interest rates where home equity is available. Depending on your immediate needs and long-term goals, your loan officer will be able to help you make the best decision.

Benefits of Refinancing Your Home

Homeowners should think about several factors while considering the benefits of refinancing their mortgages. Below are some of the most common goals borrowers have when moving forward with their refinance options.

Lower Your Monthly Payment
Refinancing your home gives you the opportunity to get a lower interest rate on your mortgage, which means smaller monthly payments. This is a good option if you're a homeowner looking for a little more disposable income, since you'll be paying less towards your mortgage every month.

Switch to a Fixed Rate Loan
Even by switching from an ARM to fixed rate mortgage, you could avoid higher monthly payments. ARMs offer low, fixed rates for the introductory period of the mortgage, after which you are at the mercy of a fluctuating market. The rates can rise suddenly, and you're left with high monthly payments. By refinancing to a fixed rate mortgage, you will have a set amount to pay every month, which gives you the freedom to budget more effectively.

Earn Cash on Your Home Equity
A cash-out refinance allows you to borrow cash against your home equity in the case of large upcoming expenses. By liquidating the equity you've already amassed, you can get cash-in-hand. The downside is that you are left with a new home loan with a principal larger than before. Despite the additional, long term cost of a cash-out refinance, it is a good opportunity for homeowners who need instant funds for renovations, tuition bills, or emergencies, without having to sell their home to make money.


FHA Refinance Options for Homeowners

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FHA Loan Articles and Mortgage News

Qualifying for a New FHA Mortgage With a Past Loan Forbearance

October 20, 2020 - In the age of coronavirus, many home loan and refinance loan policies have been re-examined to see how borrowers can be helped into new loans or refinance loans even having needed a loan forbearance.

Do You Need to Refinance Your Mortgage?

October 13, 2020 - Mortgage loan interest rates fell to incredible lows in 2020 and many homeowners have taken advantage of those low rates to refinance their mortgages. There are many reasons to do so including saving money over the lifetime of the loan by paying a lower interest rate.

Streamline Refinance Loans and Cash-Out Refinancing

September 11, 2020 - Cash-Out Refinance loans allow cash back to the borrower after the costs of the new loan have been satisfied and the original loan has been paid off. These refi mortgages can be issued by conventional lenders and through government-backed loan programs like the FHA.

Calculating Your Monthly FHA Loan Mortgage Payment

August 23, 2020 - How much will your monthly mortgage payment be? That’s an important question to ask early on when you’re planning your home loan. Is it really a simple calculation of how much the loan is, divided by how many months the mortgage loan payments are required?

Can a Borrower Use Disability Income to Qualify?

August 14, 2020 - There are many different types of income a lender may be required to verify as part of a borrower’s FHA loan or refinance loan application. Some types of income aren’t as traditional as others, yet may still qualify to be included in the borrower’s debt-to-income ratio.