FHA Short Refinancing is the process of refinancing your current mortgage(s) into a new FHA 30 year fixed rate mortgage for up to 97.75% of your homes current value (many times closing costs may be included). Many lenders are accepting short refinance payoffs because it is more cost effective than foreclosure proceedings. Foreclosure is an expensive solution for a lender for loans in default; not only does the lender not receive payments for up to a year, but they may lose out on fees associated with the procedure. A FHA Short Refinance Payoff is just one of several alternatives that might be more cost effective for your lender(s). FHA Short Refinance also allows borrowers to keep their home and allows them to reduce to loan balance to current market value.
For me, this is for someone who might have gotten their overtime income reduced, might have lost their second job, definitely a plus if they have an Adjustable Rate Mortgage (ARM) Loan or might have a fixed rate mortgage higher than 7%. Always remember that there are a lot of programs out there to help struggling homeowners. Two most important at the same time difficult guidelines they require is to qualify for : 1) Hardship and 2) to qualify for the new loan. Sometimes, your reason for your hardship is because of your income and expenses, so that is why its like a chicken and egg situation. If you make too much money you might not qualify for hardship. So, make sure when you are calling your lender you have all your financial information ready and you should analyze your own situation before getting too frustrated with your lenders.
For homeowners with ARM rates that have sky rocketed and they are still paying on their mortgages, this might be something for you. Here are the guidelines for this program:
Must be current on mortgage payments.
Minimum middle credit score is 540.
No more than one 30 day late mortgage payment in last 12 months.
Primary residence only.
Must have sufficient documented income to qualify for the new lower loan amount (no stated income).
FHA up front mortgage insurance premium 1.75% (will be added to the new loan) and annual premium of .55% will be included in the new monthly mortgage payment.
Must be struggling to make mortgage payments.
I have spoken to a few lenders and have confirmed this to be an option for homeowners who qualifies to finally reduce their rates and loan balances to keep their home. So, call me to get an evaluation to see if you can qualify for this program.
In regards to the New Obama Stimulus Loan Package that came out on March 4, 2009. Most lenders still don’t have the actual requirements yet. Please go to these websites to see if you can qualify, once I get more information I will inform you.
Here are the websites: http://www.ustreas.gov/news/index1.html
http://financialstability.gov/makinghomeaffordable/index.html
To get more details, please call Ken Go of 1st Innovative Finance Group (562) 697-7028 or write to: This e-mail address is being protected from spambots. You need JavaScript enabled to view it
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Please call me at 562-697-7028 or write to me at This e-mail address is being protected from spambots. You need JavaScript enabled to view it . This time we have to come together and help each other. ( I got a call from a distress homeowner and he gave me that line and suggestion) It’s a cliché but one that needs to be implemented.
( Published on March 18, 2009 in Asian Journal Los Angeles p. B3 )
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