Do you have less than perfect credit or lower credit score and still want to qualify for a home loan?
Are you lacking cash to use as a down payment, or have less than 20% equity in your home?
FHA home loans are one of the easier loans to qualify for, they allow for less than perfect credit and credit scores down to 500. A Utah FHA refinance is great for those lacking equity in their home, generally allowing for a higher loan to value than conventional refinance loans.
FHA government insured loan programs allow mortgage lenders to take more risk when qualifying homeowners because, which allows more Utahns to qualify for homeownership. Pre-payment penalties do not apply, and you can select a fixed rate using a 30, 25, 20 or 15 year term.
Do you want to take advantage of lower interest rates, but have struggled with your credit in the past?
Do you plan on refinancing or moving in the next five years?
An FHA variable rate loan gives you the benefit of lower interest rates while easing up on qualification requirements. FHA home loans are government insured, which mitigates loan risk for lenders.
FHA adjustable rate refinances are offered with a one year, three year, or five year fixed rate and then will adjust annually following the initial fixed period. Your interest rate will increase or decrease annually over the duration of the loan, depending on the fluctuation of mortgage interest rates.
If you are planning to move in the next few years, or simply want to take advantage of today’s low rates, this may be a great option for you.
Do you currently have an FHA loan?
Do you want to lower your monthly payment, even if you are upside down in your current loan?
Are today’s interest rates lower than when you closed on your current loan?
The FHA streamline refinance program is designed for homeowners who currently have an FHA loan, whose homes have depreciated in value since they closed on their loan, or who are currently paying a higher interest rate than what is presently available.
You can choose an ARM or a 15-year or a 30-year fixed term. You are not required to have your home re-appraised. There are also no debt ratio requirements and assets do not need to be verified.
FHA mortgages do not have prepayment penalties.
FHA loans are assumable. The outstanding mortgage balance and loan terms are transferable from the current homeowner to a new buyer. In other words, the buyer can just continue paying the remaining debt instead of applying for a new loan. As such, the financing arrangement is something you can market if you decide to sell the house at a time when current interest rates are higher than the mortgage rate on your existing mortgage. The new homebuyer still must meet certain qualifying guidelines.
FHA loans generally have a higher approval rate than other types of mortgage programs. This type of loan allows for more homeownership opportunities.