Ready to Buy a Home on Ocala? | Low on Down Payment Cash? FHA Not Only Option

Rhonda Buckner with Buckner Homes Realty
3200 SE 20 Ave. Ocala, Florida 34471
352-266-2637

With interest rates at historical lows and home prices being more affordable than they have been in decades, many people know that now is a great time to buy a home, but they may be worried about large down payment requirements.

When looking to finance a home, two of the most common questions asked include:

What loan options require a low (or no) down payment?
Is down payment assistance available?
Traditional loan options

While it is true that a 20 percent down payment is still required to avoid mortgage insurance for conventional loans, there certainly are mortgage options that require a low or no down payment. Almost all mortgage lenders offer at least these options:

VA mortgages requiring zero down.
USDA mortgages requiring zero down.
FHA mortgages requiring 3.5 percent down.
Conventional mortgages requiring 5 percent down.
Down payment assistance

In many parts of the country, down payment assistance programs are available. These programs usually work in conjunction with a local government in the form of a bond, government grant or community development program.

The U.S. Department of Housing and Urban Development maintains a database of state and local home buying assistance programs on its website.

Lease options and owner-carry

Particularly in states that were hit by the downturn in property values, the lease option has become a popular means to buy a house. The lease-option model can take many different forms and may or may not include the current owner agreeing to finance the home to the buyer.

In simple terms, the lease option is an agreement between the homeowner and the buyer where the buyer agrees to lease the property for a set period of time and at some point there is the option to get other means of financing.

In the event that the current owner of the home is willing to carry the buyer immediately, it is often referred to as an owner-carry, and the terms of the agreement can be extremely flexible regarding down payment, interest rate and term of the loan.

Essentially, there are no rules when it comes to an owner-carry or lease option: It is a negotiation between the homeowner (who is also acting as the landlord or lender or both) and the buyer (who may be a tenant for a period of time).

If you are not experienced in real estate contracts, it is always a good idea to work with an attorney or real estate agent who can help you understand what is customary in a lease option — and remember, pretty much anything goes in these agreements.

But one thing is certain: If you want to buy a home and are wondering what your options are for a low (or no) down payment, there are far more options out there than just getting an FHA loan. The easiest way to learn more about financing options? Start by asking a real estate agent. They sometimes tend to know far more about “creative financing” than loan officers do.

It is a great time to buy a home call Rhonda Buckner @352-266-2637 and find the home of your dreams

August Brings Slight Decline in Home Values

Rhonda Buckner with Buckner Homes Realty
3200 SE 20 Ave. Ocala, Florida 34471
352-266-2637

Home values fell for the first time in nine months, declining 0.1% from July to August, according to the Zillow’s August Real Estate Market Reports, which were released today.

But that shouldn’t be too worrisome, said Zillow Chief Economist Dr. Stan Humphries.

“Home values took a small hit in August, but this shouldn’t be cause for alarm,” he said. “The back half of the year is always softer than the front half, and this year is no exception. We’ve been encouraging folks to focus on the longer term trends and not monthly blips. Home values will rise a little and fall a little, month by month, in the near future, but we believe the overall trend will remain positive albeit still below normal rates of appreciation.”

Major markets that saw home values edge downward from July to August after experiencing prior increases included the Chicago (-0.7%), New York (-0.3%) and Boston (-0.2%) metros. Home values continued to climb in the Phoenix (1.6%) and Miami-Ft. Lauderdale (1%) metros, although the rate of increase was smaller in August.

For all of your Real Estate Needs Call Rhonda Buckner at 352-266-2637

Lots Of Great Deals in Ocala. | Should You Add Real Estate to Your Investment Portfolio?

Rhonda Buckner with Buckner Homes Realty
3200 SE 20 Ave. Ocala, Florida 34471
352-266-2637

As the national real estate market is in the news each week, and there is talk everywhere about cheap foreclosures, short sales and other incredible opportunities and deals, you might wonder whether investment real estate is right for you.

Real estate is not like other investments: Ownership takes time, energy and effort to manage, and it can be a real hassle. Remember when your kid overflowed the bathtub? Tenants’ kids do that, too! And you, as the landlord, have to deal with, fix and be involved with the issue or it won’t get resolved properly. And if it isn’t handled properly, it can become a bigger, more expensive problem.

And even if you have a property manager, you ultimately will have to be pretty involved and deal with the property if you want it to be a wealth building asset. The less you are involved, the higher the chances it won’t be a profitable experience. And that starts even before you purchase it by your doing the proper homework, research and analysis to find the properties that are good investments.

Is real estate right for you?

Since owning real estate is hard work, just like any other job, you need to ask yourself: Do I have the desire and time to manage my property? If you are one of those people who believes real estate will be easy money with little work, ask around. Water leaks, tenant issues, neighbors, etc., all come along with rental properties, and you, as the owner, will probably have to be involved. So does that sound appealing to you?

Is it the right property?

In order to find a fair deal on an investment, you need to educate yourself on what is a good deal. Far too many people buy property and just hope it will go up in value. Hoping something will go up in value isn’t a very sound — nor likely to be successful — investment strategy. Experienced property owners avoid even considering any appreciation in value and know that the good investments pay positive cash flow to you each month. And many properties are not very good investments — fancy downtown condos, beach houses, prime locations, etc. Some of those might be negative cash flow for several decades before you see, or more likely your grandkids see, the property’s first penny of positive cash flow.

Is the return sufficient for the risk you are taking?

You can earn a very low-risk long-term yield on corporate bonds or securities of 4-6 percent average per year. So even if the real estate has positive cash flow, does a 1 percent investment yield sound appealing in a very illiquid asset? You need to buy properties with better cash flow yields, and that’s harder to do than you think.

What’s the plan?

If you plan to only own real estate for 3-6 years, skip it. The chances of your earning a fair return from short-term ownership are pretty low. Sometimes people get lucky … but that lucky person most likely will not be you! If you have a short-term time horizon, it’s likely you will do better financially by skipping real estate ownership.

So if you are interested in adding real estate to your portfolio, and you can do the proper research, buy nice cash flow properties, manage those properties and own them a long, long time … then real estate may be a good addition to your investment portfolio.

Rhonda has worked with investors for years. She can help you decide if investing in real estate is for you. Give Rhonda Buckner a call 352-266-2637 for all of your real estate needs.

Ocala Lands On 40 and Under and Underwater list |Under 40 and Underwater: A List of the Top 100 U.S. Metros

Rhonda Buckner with Buckner Homes Realty 3200 SE 20th Ave.
Ocala, Florida 34471 352-266-2637

Last week Zillow released its second quarter Negative Equity Report. The report shows that nationally the negative equity rate had fallen to 30.9 percent from 31.4 percent in the first quarter and that half of all borrowers under 40 were underwater on their home loan.

Today Zillow is reporting the percentage of homeowners under 40 years old who are underwater on their mortgage for the 100 largest metro areas covered by the report (chart below).

This is an important number to consider when looking at the pipeline of sales. As Stan Humphries, Zillow’s chief economist, put it in a recent interview, “homeowners under 40 who are stuck in negative equity are gumming up the treadmill. They can’t move into larger homes, and those looking for entry level homes have little inventory to choose from.”

Of course, renting is always an option for homeowners who are unable to sell, and Zillow has tools for people in that situation. You can check out median rents (going up in most places) on the Zillow Real Estate Market Reports, as well as your home’s own Rent Zestimate, to help you price your home for rent, then post your home for rent, for free, on Zillow.

But, if renting out your home is not something you’re interested in, you should at least consider refinancing, especially if your current rate for a 30-year fixed mortgage is above 4.5 percent. And yes, in most instances you can refinance your underwater home loan. Zillow Mortgage Marketplace can now quote for HARP 2.0 and FHA Streamline Refinance (underwater loan program) so be sure to check it out.

In the meantime, take a look at the alphabetical list of the percentage of homeowners under 40 who are underwater on their mortgage. The list ranges from 23.3 percent in the Rochester, NY metro area all of the way up to 81.4 percent in the Las Vegas, NV metro.

A Short could be your answer! Give Rhonda Buckner a call at 352-266-2637. Rhonda sells short sales quickly!

HARP 2.0 Dominates Conforming Mortgage Landscape In Some States

Rhonda Buckner with Buckner Homes Realty 3200 SE 20th AVE Ocala, Florida 34471 352-266-2637

HARP Statistics : HARP refinances as a percentage of all refinances, by state, July 2012

HARP 2.0 has been a boon to the U.S. homeowner. As mortgage rates have dropped, it’s given homeowners with little, zero, or negative equity access to this year’s ongoing Refi Boom. Not surprisingly, in some states, HARP is more common than in others.

Click here to get HARP mortgage rates.

HARP : Minimal Qualification Standards

The Home Affordable Refinance Program (HARP) is a government refinance program meant for homeowners whose homes have lost value. It was initially launched in 2009 as part of the Making Home Affordable initiative, a program which also launched HAMP (Home Affordable Modification Program).

The main difference between HARP and HAMP is that HARP is for homeowners who are current on their respective mortgages. HAMP is for homeowners facing foreclosure or whom are otherwise delinquent on their mortgage.

HARP is sometimes called the “Obama Refi”, and it’s a program offered via Fannie Mae and Freddie Mac exclusively. The Fannie Mae version of HARP is known as “Refi Plus”. The Freddie Mac version is known as “Relief Refinance”. Both programs do the exact same thing.

The requirements for a HARP mortgage are basic :

Your loan must have been securitized by Fannie Mae or Freddie Mac
Your loan must have been securitized on, or before, May 31, 2009
You may not have previously used the HARP program to refinance
In addition, your mortgage payment history must be perfect for the last 6 months with no more than one late payment in the last 12 months.

Click here for a complete HARP Q&A.

HARP 2.0 : Underwater Homeowners Get Relief

When HARP was initially launched in 2009, it was built to reach more than 7 million U.S. households. Through its first two years, however, it was clear that the Home Affordable Refinance Program was falling short of that goal.

Between 2009-2011, HARP helped fewer than one million households.

So, to help give HARP more teeth, the government re-wrote and re-tooled it. The changes were split into two parts. The first part was meant to reduce HARP lending risks for banks, compelling more banks to offer the program. That move was successful.

The second part was geared at homeowners. With HARP 2.0, regardless of home equity, homeowners were made refinance-eligible. HARP was changed to allow for unlimited LTV. So long as your loan size does not exceed your local conforming loan limits, you can use HARP.

It doesn’t matter what your home is (not) worth. Yes, you can use HARP to refinance.

Click here to get HARP mortgage rates.

Nevada, Florida, Arizona Lead In HARP “Market Share”

Since HARP has moved to unlimited LTV, it’s become a big part of the refinance landscape in the states hardest-hit by last decade’s housing downturn. States like Nevada, for example, where nearly 70% of all refinances in July were HARP refinances. Or, Florida, in which 60% of all refinances were HARP.

There were four states in which HARP accounted for more than half of all conforming refis.

For July 2012, the top 10 states in terms of HARP refinances as a percentage of all conforming refinances closed were :

Nevada : 69.49% of closed conforming refinances were via HARP
Florida : 60.04% of closed conforming refinances were via HARP
Arizona : 57.13% of closed conforming refinances were via HARP
Michigan : 51.78% of closed conforming refinances were via HARP
Georgia ; 49.67% of closed conforming refinances were via HARP
Idaho : 49.42% of closed conforming refinances were via HARP
Minnesota : 37.05% of closed conforming refinances were via HARP
Oregon : 35.20% of closed conforming refinances were via HARP
Washington : 32.05% of closed conforming refinances were via HARP
Maryland : 30.25% of closed conforming refinances were via HARP
The states in which HARP loan were less common included Alaska (5.77%), South Dakota (4.12%) and North Dakota (1.05%).

These states are home to fewer Home Affordable Refinance Program refinances, in part, because the pool of eligible borrowers is relatively smaller. Alaska, North Dakota and South Dakota didn’t see the same home price deterioration as much of the country between 2007 and October 2011.

Click here to get HARP mortgage rates.

Get HARP Mortgage Rates

If you’ve been looking at the HARP program — regardless of your loan-to-value and regardless of whether you’ve been turned down for HARP by a bank — it’s a good time to look again. HARP mortgage guidelines vary by bank, and those guidelines seem to be getting more loose, on the whole.

Ask for today’s HARP mortgage rates. See how low your mortgage payment could get.

Give Rhonda Buckner a call if you have any questions at 352-266-2637

Ocala Bank of America and Wells Fargo Home Owners | Bank of America offering up to $30,000 for short sales

Rhonda Buckner with Buckner Homes Realty 3200 SE 20th Ave. Ocala, FLorida 34471. 352-266-2637

NEW YORK (CNNMoney) — Bank of America is offering some struggling homeowners payments of up to $30,000 if they sell their homes in a short sale and avoid ending up in foreclosure.
Under the plan, Bank of America (BAC, Fortune 500) will offer homeowners so-called relocation payments of between $2,500 and $30,000 if they sell their home in a short sale. In short sale deals, the sale price of the home is less than what the seller owes the bank.

The bank first tested the payments in a pilot program in Florida last fall. Under that initiative, Bank of America paid up to $20,000 to borrowers who sold their homes in short sales.
“This program can help customers make a planned transition from ownership when home retention options have been exhausted or they have made a decision not to keep the home,” said Bob Hora, an executive for the bank.
Short sale make up 1-in-4 homes sold
Chase (JPM, Fortune 500) started a similar initiative in late 2010 that pays as much as $35,000 to short sellers. Wells Fargo (WFC, Fortune 500) has also paid five-figure incentives to short sellers or to owners who turned over their deeds to the bank.
BofA said it has completed 200,000 short sales over the past two years. These sales are generally more cost effective for banks than foreclosures. By avoiding foreclosure, the lenders get distressed properties back from delinquent borrowers more quickly, which helps them to avoid property tax payments, maintenance expenses and legal fees that can build up for months, even years, as foreclosures work through the system.

In addition, the incentives help guarantee the homes will return to the lenders in better condition. Foreclosed properties are often poorly maintained, even sometimes sabotaged, by angry former owners, making them worth far less to the banks.
During the last three months of 2011, foreclosures sold for an average of about $150,000, according to RealtyTrac. Meanwhile, short sales sold for an average of about $185,000.
Banks pay delinquent borrowers up sell their homes
To qualify for Bank of America’s relocation payments, borrowers must obtain pre-approval on sale prices for their homes. The sale must begin by the end of 2012 and close by September 26, 2013.
The exact compensation is determined case-by-case based on a calculation that involves the home’s value, mortgage balance and other factors.
Borrowers can call 877-459-2852 to find out if they may be eligible for the program.

Rhonda Buckner is Ocala’s Premier Short Sales specialist. She has helped many families threw the short sale process. Call Rhonda at
325-266-2637 to learn more about the short sale process.

Maybe it could be a good time for you to buy a home in Ocala? | FHA May Waive Its 3-Year Foreclosure Waiting Period

Rhonda Buckner with Buckner Homes Realty 3200 SE 20 ave 34471
352-266-2636

FHA : Loans For Borrowers With 500 FICO Or Better

The Federal Housing Administration (FHA) is not a mortgage lender; the FHA does not make loans. Rather, it insures loans for banks that do.

The FHA publishes a compendium of rules known as “FHA mortgage guidelines” and so long as a mortgage meets of the rules’ minimum standards, the FHA will insure the loan-issuing bank against default.

A better name for an FHA mortgage, then, might be FHA-insured mortgage; it’s a more accurate reflection of the relationship between the FHA and mortgage lender nationwide.

Click here for today’s mortgage rates.

For purchase transactions, FHA mortgage guidelines are fairly straight-forward :

Monthly debt should not exceed 45% of household income, without excellent cause
Downpayment must be 3.5% of purchase price or appraised value, whichever is lower
Credit scores of 580 or higher get “maximum financing”; Scores under 500 disallowed
In addition, mortgage loan sizes may not exceed local FHA loan limits.

In most areas nationwide, including Palo Alto County, Iowa; Price George’s County, Maryland; and Miami County, Ohio, for example, local FHA loan limits are $271,050.

In other “high-cost” areas including Los Angeles County, California; Monroe County, Florida; and Eagle County, Colorado, the local FHA loan limit is $729,750.

Click here to check your area’s FHA loan limit.

FHA Mortgage Guidelines Change With The Economy

Mortgage guidelines are a living, breathing thing. As the housing market moves, and as credit conditions necessitate, mortgage guidelines morph. This is true for FHA mortgage guidelines, just as it is for Fannie Mae- and Freddie Mac-type loans and VA loans, for example.

Guideline changes can be small; increasing maximum debt-to-income ratios from 43% to 45%, for example. Or, they can be big. The HARP 2.0 program is a good example of this. Other times, changes are major — broad enough in scope that they reverberate throughout the housing market as a whole.

The FHA may make a major guideline change soon.

Within 75 days, the FHA is expected to change its purchase mortgage guidelines to allow home buyers with major derogatory credit events in their recent history to skip the traditional “waiting period” for an FHA-backed mortgage.

Click here for today’s mortgage rates.

FHA : “Ignore” Foreclosures, Bankruptcy, Short Sales?

Major derogatory events include foreclosure, short sale, and Chapter 7 bankruptcy. The mandatory waiting period of each of the aforementioned events are as follows, assuming credit has been re-established by the borrower :

Foreclosure : Must wait 3 years before eligible for FHA-insured financing
Short Sale In Default : Must wait 3 years before eligible for FHA-insured financing
Chapter 7 Bankruptcy : Must wait 2 years before eligible for FHA-insured financing
Under the FHA’s expected new plan, these waiting periods will be waived in full.

Soon, FHA-insured loans may be available to home buyers who may have been recently foreclosed upon; for whom a short sale was necessary; or for whom a Chapter 7 bankruptcy was discharged yesterday.

The FHA’s new waiver on foreclosures, short sales and bankruptcies would add to the national pool of home buyers, creating buy-side demand for housing and upward pressure for home values nationwide.

Click here for today’s mortgage rates.

See Today’s FHA Mortgage Rates

The FHA has grown its market share since the start of the decade on a combination of sound mortgage guidelines, low mortgage rates for borrowers, and a minimum downpayment option of just 3.5%. With its expected “waiting period” waiver, the FHA figures to grow its market share, and the pool of potential buyers nationwide.

Home prices have made slow, steady gains since October 2011 and those gains may accelerate with new FHA policies. See how today’s FHA mortgage rates can fit in your household budget.

Give Rhonda Buckner a call at 352-266-2637 to find the home of your dreams!

Facing Forclosure in Ocala? | Tips to Help Prevent Foreclosure

Rhonda Buckner- Buckner Homes Realty 3200 SE 20 Ave. Ocala, Florida
34471 Phone 352-266-2637

In early 2011, you may remember there was a lull in foreclosure activity – a lull that was prompted by nationwide scrutiny into lenders’ home-seizure practices. But in more recent months, as barriers that have been holding foreclosures back have been removed, banks, anxious to rid their books of long-delinquent mortgage loans, have been stepping up foreclosures — all over the country.

Granted, we’re well below the peak levels we saw from 2007-2010, but even so, consider this: In March, 2012, foreclosure filings were reported on nearly 200,000 properties — that’s 7.4 out of every 10,000 homes. With many more foreclosures in the pipeline, here’s how to avoid becoming a statistic:

Buy a home you can truly afford

Ok, so this is an obvious point, but reiterating the numbers is never a bad idea: Your housing costs (mortgage, insurance, taxes) should be no more than 25-28% of your monthly take-home pay. Use Zillow’s affordability and mortgage calculators. They’ll estimate the monthly costs of home ownership within the context of your monthly budget. If the payments seem too unruly (Give them a test drive!), you may need to come up with a larger down payment or shelve your purchase plans altogether.

Contact your lender immediately!

Doesn’t look like you’re going to be able to make that payment .. again? You need to let your lender know about your financial woes immediately, and, ideally, while your head is still above water and your credit is in tact.

Consider temporary relief

If you think that your inability to your make your mortgage payments is going to be temporary, see what kind of temporary relief your mortgage servicer can offer. They may be willing to accept reduced payments over a certain period of time; they may allow you to skip payments over a certain period of time; they may extend the grace period for late payments. Just remember: these solutions are temporary, so in the interim, try to find new ways to slash spending and save more. You must also prioritize your bills, paying attention to the ones that are the most essential.

Look into a modification

If your financial situation has permanently changed, then temporary relief is not going help much. You may need to have your loan modified. And while there are many different ways to do a modification, they generally incorporate interest rate cuts, term extensions and principle reductions – or a combination of these methods. Yes, there is a lot of paperwork involved, and yes, it can be complicated, but banks are under pressure to do these modifications and as a result, we are seeing higher success rates: the average savings, per modification, is about $500 a month. To see if you are eligible for a modification, go to makinghomeaffordable.gov.

Explore a short sale

If you’re underwater (as 23% of homeowners are today), cash-strapped, desperate for relief, and foreclosure is looking imminent/speed is of the essence, then you might want to consider a short sale. This where you’re selling your home, for less than what you owe on it, to your mortgage lender. The upside: No more negative equity burden; it’s not as damaging to your credit as a foreclosure is; you can purchase a home again in as little as 3 yrs; and you’re selling your home with your pride in tact.

Rhonda Buckner Specializes in Short Sales and can help get you through the entire Short Sale Process. Call Rhonda Buckner at 352-266-2637

Ocala Creative Options for Financing | Low on Down Payment Cash? FHA Not Only Option

Rhonda Buckner with Buckner Homes Realty 3200 SE 20 Ave Ocala, Florida. 34471 352-266-2637

With interest rates at historical lows and home prices being more affordable than they have been in decades, many people know that now is a great time to buy a home, but they may be worried about large down payment requirements.

When looking to finance a home, two of the most common questions asked include:

What loan options require a low (or no) down payment?
Is down payment assistance available?
Traditional loan options

While it is true that a 20 percent down payment is still required to avoid mortgage insurance for conventional loans, there certainly are mortgage options that require a low or no down payment. Almost all mortgage lenders offer at least these options:

VA mortgages requiring zero down.
USDA mortgages requiring zero down.
FHA mortgages requiring 3.5 percent down.
Conventional mortgages requiring 5 percent down.
Down payment assistance

In many parts of the country, down payment assistance programs are available. These programs usually work in conjunction with a local government in the form of a bond, government grant or community development program.

The U.S. Department of Housing and Urban Development maintains a database of state and local home buying assistance programs on its website.

Lease options and owner-carry

Particularly in states that were hit by the downturn in property values, the lease option has become a popular means to buy a house. The lease-option model can take many different forms and may or may not include the current owner agreeing to finance the home to the buyer.

In simple terms, the lease option is an agreement between the homeowner and the buyer where the buyer agrees to lease the property for a set period of time and at some point there is the option to get other means of financing.

In the event that the current owner of the home is willing to carry the buyer immediately, it is often referred to as an owner-carry, and the terms of the agreement can be extremely flexible regarding down payment, interest rate and term of the loan.

Essentially, there are no rules when it comes to an owner-carry or lease option: It is a negotiation between the homeowner (who is also acting as the landlord or lender or both) and the buyer (who may be a tenant for a period of time).

If you are not experienced in real estate contracts, it is always a good idea to work with an attorney or real estate agent who can help you understand what is customary in a lease option — and remember, pretty much anything goes in these agreements.

But one thing is certain: If you want to buy a home and are wondering what your options are for a low (or no) down payment, there are far more options out there than just getting an FHA loan. The easiest way to learn more about financing options? Start by asking a real estate agent. They sometimes tend to know far more about “creative financing” than loan officers do.

It is a great time to buy! Give Rhonda a call at 352-266-2637 and she can help you find the perfect place to call home!

Ocala FHA Homeowners Consider a FHA Streamline Refinance.. | What Is An FHA Streamline Refinance?

Rhonda Buckner with Buckner Homes Realty, 3200 S E 20 Ave. Ocala,
Florida 34471 phone 352-266-2637

The FHA Streamline Refinance is a special mortgage product, reserved for homeowners with existing FHA mortgages. Homeowners with conventional mortgages via Fannie Mae or Freddie can’t use it. FHA Streamline Refinances are the fastest, simplest way for FHA-insured homeowners to refinance their respective mortgages.

The FHA Streamline Refinance program’s defining characteristic is that it does not require a home appraisal. Instead, the FHA will allow you to use your original purchase price as your home’s current value, regardless of what your home is actually worth today.

In this way, with its FHA Streamline Refinance program, the FHA does not care if you are underwater on your mortgage. In fact, the program encourages underwater mortgages. Even if you owe twice what your home is now worth, the FHA will refinance your home without added cost or penalty.

The FHA allows for unlimited loan-to-value with its Streamline Refi program — a huge help to FHA homeowners in places like Florida, California, Arizona and Georgia.

Except for this “no appraisal” benefit, the FHA Streamline Refinance is very much like other loan products. It’s available as a fixed rate or adjustable mortgage; it comes with 15- or 30-year terms; and there’s no prepayment penalty to worry about.

Another big plus is that FHA mortgage rates are as low with the Streamline Refinance program as with “regular” FHA loans.

Click here for today’s FHA Streamline Refinance mortgage rates.

FHA Streamline : No Verification Of Job, Income, Credit

Another big plus is that the FHA Streamline Refinance is fairly easy for which to qualify.

In a sweeping guideline update, in April 2011, the FHA abolished verification for practically everything on an FHA Streamline Refinance mortgage application. Now, as written in the FHA’s official mortgage guidelines, the mortgage approval process for an FHA Streamline Refinance says :

Employment verification is not required with an FHA Streamline Refinance
Income verification is not required with an FHA Streamline Refinance
Credit score verification is not required with an FHA Streamline Refinance
And, as mentioned earlier, there’s no need for a home appraisal, either.

Click here for today’s FHA Streamline Refinance mortgage rates.

Put it all together and it means that you can be (1) out-of-work, (2) without income, (3) carry a terrible credit rating and (4) have no home equity — and yet, you will still be approved for the FHA Streamline Refinance program.

That’s not as crazy as it sounds, by the way.

To understand why the FHA Streamline Refinance is a smart program for the FHA, we have to remember that the FHA’s chief role is to insure mortgages — not “make” them.

Therefore, it’s in the FHA’s best interest to help as many people as possible qualify for today’s low mortgage rates. Lower mortgage rates means lower monthly payments which, in theory, leads to fewer loan defaults.

This is good for homeowners that want lower mortgage rates, and for the FHA, but mostly for the FHA.

Are You FHA Streamline Refinance Eligible?

Although the FHA Streamline Refinance eschews the “traditional” mortgage verifications of income and credit score, as examples, the program does enforce minimum standards for applicants. The official FHA Streamline Refinance guidelines are below.

Click here for today’s FHA Streamline Refinance mortgage rates.

Perfect, 12-Month Payment History Is Required

The FHA’s main goal is to reduce its overall loan pool risk. Therefore, it’s number one qualification standard is that homeowners using the Streamline Refinance program must have a perfect payment history stretching back 12 months. 30-day, 60-day, and 90-day lates are not allowed. Furthermore, loans must be current at the time of closing.

210-Day “Waiting Period” Between Refinances

The FHA requires that borrowers make 6 mortgage payments on their current FHA-insured loan, and that 210 days pass from the most recent closing date, in order to be eligible for a Streamline Refinance.

Employment And Income Are Not Verified

The FHA does not require verification of a borrower’s employment or annual income as part of the FHA Streamline process. There is no Verification of Employment, nor are there paystubs, W-2s or tax returns required for approval. You can be unemployed and get approved for a FHA Streamline Refinance so long as you still meet the other program requirements.

Credit Scores Are Not Verified

The FHA does not verify credit scores as part of the FHA Streamline Refinance program. Instead, it uses payment history as a gauge for future loan performance. This means that FICOs under 640, under 620, under 580, and under 500 are eligible for Streamline Refis.

The Refinance Must Have “Purpose”

Streamline Refinance applicants must demonstrate that there’s a Net Tangible Benefit in the refinance; a legitimate reason for refinancing. Loosely, Net Tangible Benefit is defined as reducing the (principal + interest + mortgage insurance) component of the mortgage payment by 5 percent or more. Another allowable Net Tangible Benefit is to refinance from an adjusting ARM into a fixed rate loan. Taking “cash out” to pay bills is not an allowable Net Tangible Benefit.

Loan Balances May Not Increase To Cover Loan Costs

The FHA prohibits increasing a Streamline Refinance’s loan balance to cover associated loan charges. The new loan balance is limited by the math formula of (Current Principal Balance + Upfront Mortgage Insurance Premium). All other costs — origination charges, title charges, escrow population — must be either (1) Paid by the borrower as cash at closing, or (2) Credited by the loan officer in full. The latter is called a “zero-cost FHA Streamline”. Click here for a zero-cost FHA Streamline Refinance mortgage rates.

Appraisals Not Required

The FHA isn’t concerned about home value — it’s insuring your loan regardless. Therefore, the FHA does not require appraisals for its Streamline Refinance program. Instead, it uses the original purchase price of your home, or the most recent appraised value, as its valuation point. Homes that are underwater are still FHA Streamline-eligible.

FHA Streamline Refinance Mortgage Insurance Requirements

The FHA Streamline Refinance is an FHA-insured mortgage, and FHA borrowers are required to make two types of mortgage insurance payments — an upfront mortgage insurance payment paid at closing, plus an annual one split into 12 installments, paid with your mortgage payment each month.

With respect to mortgage insurance premiums, as of June 11, 2012, homeowners using the FHA Streamline Refinance program are split into two classes :

Homeowners whose new loan replaces an FHA-backed mortgage endorsed before June 1, 2009
Homeowners whose new loan replaces an FHA-backed mortgage endorsed on/after June 1, 2009.
Beginning June 11, 2012, homeowners in the first class — those with”old” FHA mortgages to refinance — will pay markedly lower mortgage insurance than homeowners in the second class of borrowers.

Click here for today’s FHA Streamline Refinance mortgage rates.

FHA Streamline Refinance MIP Rates (For Loans Endorsed Before June 1, 2009)

If your existing FHA mortgage was endorsed prior to June 1, 2009, your mortgage insurance premiums have been “grandfathered”. You can refinance to the FHA Streamline Refinance program and pay reduced rates for both for upfront MIP and annual mortgage insurance premiums.

Upfront MIP

For an FHA Streamline Refinance that replaces a loan endorsed prior to June 1, 2009, the new FHA mortgage’s upfront mortgage insurance is equal to 0.01 percent of the loan size, or 1 basis point.

For example, if your new FHA Streamline Refinance is for $100,000 mortgage, the FHA will assess a $10 upfront mortgage insurance premium (MIP) to be paid by you at closing. The FHA automatically adds the $10 payment to your new loan balance.

Click here for today’s FHA Streamline Refinance mortgage rates.

Annual MIP

Annual MIP is similarly cheap. For an FHA Streamline Refinance that replaces a FHA loan endorsed prior to June 1, 2009, the annual MIP is 0.55% annually, or 55 basis points.

The complete annual MIP schedule is as follows :

15-year loan terms with loan-to-value over 90% : 0.55 percent annual MIP
15-year loan terms with loan-t0-value under 90% : 0.55 percent annual MIP
30-year loan terms with loan-to-value over 95% : 0.55 percent annual MIP
30-year loan terms with loan-to-value under 95% : 0.55 percent annual MIP
15-year fixed rate mortgages with LTVs of 78% or less pay no annual MIP.

For an FHA Streamline Refinance that replaces a FHA loan endorsed prior to June 1, 2009 and for which the mortgage is a jumbo FHA mortgage in excess of $625,500, there is no additional mortgage insurance premium.

Click here for today’s FHA Streamline Refinance mortgage rates.

FHA Streamline MIP For Loans Endorsed On/After June 1, 2009

If your existing FHA mortgage was endorsed on, or after, June 1, 2009, your new FHA mortgage insurance premiums are the same as for all other FHA mortgage applicants.

Upfront MIP

For an FHA Streamline Refinance that replaces a loan endorsed on, or after, June 1, 2009, the new FHA mortgage’s upfront mortgage insurance is equal to 1.75 percent of the loan size, or 175 basis points.

For example, if your new FHA Streamline Refinance is for $100,000 mortgage, the FHA will assess a $1,750 upfront mortgage insurance premium (MIP) to be paid by you at closing. The FHA automatically rolls the $1,750 payment into your new loan balance.

Not all FHA homeowners will pay this full amount, however.

One great thing about the FHA Streamline Refinance program is that the FHA offers refund on previously-paid upfront MIP so long as you’re still within the first 3 years of your mortgage.

As an example, refinancing after 11 months grants a 60% refund, but waiting just one more month lowers that refund down to 58%. This is why is rarely a good idea to “wait to refinance” with the FHA. With the FHA Streamline Refinance, the sooner you refinance, the bigger your MIP refund, and the lower your final loan size. This preserves home equity.

You can review your own FHA mortgage insurance refund chart at top.

Click here for today’s FHA Streamline Refinance mortgage rates.

Annual MIP

For an FHA Streamline Refinance that replaces a FHA loan endorsed on, or after, June 1, 2009, the annual MIP varies based on loan type and loan-to-value.

The annual MIP schedule, for loans with case numbers assigned on, of after, June 1, 2009 :

15-year loan terms with loan-to-value over 90% : 0.60 percent annual MIP
15-year loan terms with loan-t0-value under 90% : 0.35 percent annual MIP
30-year loan terms with loan-to-value over 95% : 1.25 percent annual MIP
30-year loan terms with loan-to-value under 95% : 1.20 percent annual MIP
15-year fixed rate mortgages with LTVs of 78% or less pay no annual MIP. Mortgages made for $625,500 or more are subject to an additional 0.25 percent annual mortgage insurance fee.

A Los Angeles, California homeowner, therefore, using the FHA’s full $729,750 local loan limit for a low-downpayment, 30-year fixed rate mortgage will pay annual mortgage insurance premium of 1.50% to the FHA, or $912 per month.

Note that mortgage insurance payments are included in the FHA’s Net Tangible Benefit requirement. You must lower your monthly payment by at 5 percent to qualify for the FHA Streamline Refinance.

Click here for today’s FHA Streamline Refinance mortgage rates.

Apply For Your FHA Streamline Refinance Here

The FHA Streamline Refinance is among the easiest and best-valued mortgage products available.

If you have an existing FHA mortgage, get yourself a FHA Streamline Refinance rate quote. FHA mortgage rates are low and my office underwrites and funds FHA loan in-house. This means we can close your mortgage faster, entitling you to a bigger FHA refund check on your Streamline Refinance.

Click here to get a rate quote and start your FHA Streamline Refinance application.

This FHA Streamline Refinance information is accurate as of today, . If you get FHA Streamline Refinance information somewhere else, it may be inaccurate or out-of-date.

For all of your real estate needs contact Rhonda Buckner with Buckner Homes Realty at 352-266-2637