Tips For FHA Mortgage Refinancing

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					Tips For FHA Mortgage Refinancing
Are you considering refinancing your home loan using an FHA mortgage?
It's been widely known that mortgage rates are close to all-time lows.
FHA guidelines have changed and present a great chance for you to lock
yourself into a low fixed rate mortgage. A normal conventional loan is a
bit tougher to get nowadays versus an FHA loan. It is mainly due to the
ladder allowing some derogatory credit, higher debt to income ratios, and
financing above eighty percent.
FHA Refinance Qualifying
It is important to understand what is needed to qualify for an FHA
mortgage loan. Your monthly home loan payment, which includes principal,
interest, taxes and insurance, needs to be less than 31% of your total
income per month. Your total debt ratios should be no more than 43% of
your total income. This is a guideline and can sometimes be lifted
depending on other factors. For example, we have heard of total debt to
income ratios loans below fifty-percent still being approved. In fact,
some FHA lenders will approve your loan request while other lenders who
have the exact same request will turn it down. So, the point being, do
not give up and be discouraged if one lender turns you down.
FHA Mortgage Credit Requirements
A borrower's credit rating and history does play a role for an FHA
refinance loan as far as credit requirements. Typically, a credit score
above 580 is acceptable. Borrowers with past credit issues but who have
demonstrated timely payments, have sufficient income, after that episode
will not always be denied from loan approval. In fact, FHA will still
approve your loan if you have a recent mortgage late payment but it
depends on other factors.
Borrowers who have had a recent bankruptcy are still eligible for a FHA
refinance. A bankruptcy discharged for a minimum of twenty-four months
still lets you qualify provided all other factors are sufficient. It gets
even better if you've had a chapter 13 bankruptcy discharged for at least
one year.
Depending on the equity in your property, a borrower is allowed to
refinance up to 98% of their home's value determined by a state licensed
certified appraiser who may also need to be approved by the lender. If it
is a cash-out refinance the maximum allowed is 95% of your home's value.
As of late, there are some lenders who want bad loans off their books so
they will permit them to a FHA short refinance loan. Get more information
on refinancing into a FHA loan from this website.
Frank Collins is an avid investor in real estate and contributor to Jumbo
Home Mortgage and a website to Find Low Mortgage Rates and trusted
lenders in your area.

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