Can I Refinance My FHA Loan?

Yes, in fact if you took out an FHA mortgage in 2013 or 2014, your mortgage insurance premium on an annualized basis was likely upwards of 1.3% of your loan amount driving the cost of your monthly PMI higher On January 26, 2015, the FHA  announced they will be reducing the monthly mortgage insurance premiums on FHA loans  moving forward. The  PMI  on FHA loans is now .85%, a substantial reduction  in the PMI cost making the prospect of refinancing much more attractive for many. Take the following example:

For buyer who purchased a home in 2014.

Let’s say the purchase price was 470,000 and their mortgage payment on an FHA loan is $3151 per month, with a 30 year fixed at 4 %.

New loan numbers might look as follows:

new loan amount $413,105 at 3.625%

principal and interest payment $1883

taxes $578

insurance $70

PMI $267

new mortgage payment $2799 earmarking a savings of $443 per month!

3 Drivers Of Why Refinancing Your FHA Mortgage Makes Sense in 2015!

Mortgage interest rates are lower. A lower rate of interest means a subsequent lower monthly payment.

Lower finance loan amount now as you’ve been paying principal and interest on a monthly basis with your balance decreasing each month since you last took out a mortgage. Financing a loan size lower than your previous loan amount also drives the payment lower.

PMI  is the biggest driver is the PMI is substantially lower now than on the last FHA mortgage you previously took out.

If  You have an FHA mortgage with any interest rate 3.25% or higher, now is the time to consider refinancing your FHA loan into a new FHA loan or the possibly looking at a conventional loan. Conventional loans moving out of FHA loans will not allow for an approval without or no foreclosure at all or four years on a previous short sale. In other words if the reason you had to go FHA first place was due to a derogatory credit event such as a short sale or a foreclosure seven year and four-year time frames  hold.  That does not preclude you from the ability to save money by refinancing into an FHA loan considering in 99.9% of cases that provides for an immediate net tangible benefit in the form of lower interest expense and payment on the household cash flow.

Do  You have an FHA mortgage? If you’re thinking about refinancing start with us by getting a free quote, to see how much you can save.






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