We are at a unique crossroads when it comes to FHA mortgage interest rates. FHA is a little bit unique when it comes to pricing because pricing never fall evenly. Right now I can price a large loan with the borrower paying his or her own closing costs and get them 4.375% . That is an amazing rate! They will go on their merry way and enjoy the benefits of that loan for as long as they are in the home. 4.375% is an amazing rate considering on top of that they will receive tax benefits in the form of interest deductions on their taxes which makes their effective rate in the 3’s. Considering in today’s world we can get a tax free investment at 6% this makes good sense. If you don’t believe me ask me about this. I have a number of investment vehicles that guarantee a minimum return and have upside risk based on the stock market.
With FHA, I can also price a customer’s loan in a different bucket that provides a higher rate but allows me to pay all of their closing costs. (A free loan.) At 4.75%, I can lower the rate of just about all FHA homeowners who obtained a loan in the last e.g (50 years) The FHA Streamline refinance without appraisal is the loan that I am currently selling because I can provide it for free and the rate is so low that virtually every FHA homeowner in America would benefit. There is no worry of value being low because the program does not call for an appraisal as long as the new loan amount is less than the old loan amount which is something smartly done by FHA (Federal Housing Authority a division of HUD)
Within the FHA program, recently the monthly mortgage insurance factor has been bumped up and the amount financed over 30 years has been lowered. Mortgage insurance is supposed to be released from the loan when the balance of the loan hits 78% of the value of the house. With home values headed in the opposite direction over the last few years this has been difficult but it appears that home prices are turning around and we are headed in the right direction again.
Not only do we have amazing rates but FHA is the mortgage program that is holding up the country. Every day, due to unemployment and decreasing earnings less and less people qualify for a loan. FHA allows for lower credit scores than Fannie Mae/Freddie Mac and there are no annoying price adjustments that push the interest rate up. With FHA I have loan programs that qualify down to a 600 credit score which is really quite aggressive. Three trade lines paid on time with a good rental history will allow you to purchase a home in today’s market. With the streamline refinance without appraisal described above, I even have sources that allow me to list the employment and assets and not have to verify with paystubs , W-2’s and bank statements.
These are the types of guidelines and benefits that we offer that most customers will not be aware of unless they ask questions.
Your Lender for Life and a Valuable Resource to All of Your Friends
