There are two primary types of FHA refinance programs.
FHA 203(b)
When someone says they want an FHA loan, this is what they’re talking about. The FHA 203(b) can also be used to refinance an existing conventional or FHA mortgage.
FHA 203(b) refinance benefits include:
- Down payment as low as 3.5 percent. Down payment can also be a gift from parents or relatives.
- Looser credit qualifications than conventional refinance loans.
- Lower closing costs.
- Private mortgage insurance (PMI) can be paid in cash or financed as part of the loan.
- Choose from fixed or adjustable interest rate.
- No prepayment penalties.
FHA Streamline
If you already have an existing FHA mortgage, an FHA Streamline refinance loan is a good option. Unlike a conventional refinance, an FHA Streamline refinance doesn’t have many of the income and appraisal requirements, providing you a quick, easy way to make your mortgage more affordable. It also offers higher loan-to-value ratios, so you may still qualify even if you have little to no equity in your home.
With an FHA Streamline refinance, you can:
- Lower monthly payments.
- Reduce interest rates.
- Build equity faster.
- Pay off loans sooner.
For more information about FHA refinancing, including complete eligibility requirements, contact us today.
