Refinancing Applications Fall as Rates Rise

Usually when financial times are tough like they are today in this country you don’t see much adversity in mortgage lending. Oh sure, the usual suspects, banks and credit unions will continue to have a tight reign on who the borrowers are and verification of the ever popular FICO scores required in order to avoid the calamity of previous years. But conventional loan refinances are still competitive and refinancing applications still trickle into many lenders. But it’s not the deluge they acknowledged in the past 24 months due mostly to the financial jargon called “cherry picking.” Ergo, if you’re not a member in good standing in the “cherry picking’ crowd, you’ll have to look elsewhere for your refinancing loan.

The fact remains that you can search online everyday and twice on Sunday for the best refinancing, and not come close to locating anything better than an FHA Streamline refinance loan. It’s an amazing loan loaded with a barrel-full of advantages for any current FHA mortgage holder. It’s the quickest way to reach “home base” if you’re still stranded on “3rd base” wishing to replace an existing FHA loan you’ve been suffering with for a year or two with an interest rate you don’t like.

Using the FHA Streamline refinancing loan program you’re going to hear a lot of one word: “NO.”
#1 – No income verification
#2 – No new appraisal required unless you want one
#3 – No verification of employment
#4 – No pay stubs, W-2′s, or tax returns required
#5 – No updated credit or FICO score check
#6 – No closing costs
#7 – No PMI upfront fees
You get all this plus a single digit interest rate that’s so low you may need a magnifying glass to find it, and a 30 year fixed rate. Okay, that’s the good news, folks. Now here is the not-so-bad news regarding the FHA Streamline refinancing loan.

On your current FHA mortgage loan you’re required to have made a minimum of six mortgage payments before becoming eligible plus 210 days must pass from the original closing date, as well. You also must have a perfect payment history on your current mortgage for at least one year with NO late payments. Finally FHA will want to know the reason why you are refinancing. Typical good answers are: lower interest rate or you desire a fixed rate, not your current ARM.

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