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FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
FHA Refinance Loan Programs
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FHA Refinance Loan Programs

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Another home ownership education class about FHA refinancing options. …

Another home ownership education class about FHA refinancing options.

More important than knowing what programs are available is understanding the cost involved and how to determine if a refinance will really benefit you.

This informative on-line class discusses how to do a cost benefit analysis to determine your actual benefit, as well as a complete discussion of what FHA loan programs are available for you to take advantage of.

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  • 1. A Complete Guide to FHA Refinance Loan Options Thank You for Attending Class will begin at 7:00pm Presented By: Broadview Mortgage Corporation Presenter: Scott Schang Contact Information: Phone: 866-667-6724 [email_address]
  • 2. A Complete Guide to FHA Refinance Loan Options <ul><li>The Purpose and Goals of this Class </li></ul><ul><li>To Educate and Empower Home Owners </li></ul><ul><li>To tell you the things that lenders/brokers don’t usually like you to know about </li></ul><ul><li>Educate you about the FHA refinance options available to you in today’s market </li></ul><ul><li>Empower you with the ability to make educated decisions about your refinance options </li></ul>
  • 3. A Complete Guide to FHA Refinance Loan Options <ul><li>Topics We Will Cover In This Class </li></ul><ul><li>The Importance of doing a Cost/Benefit Analysis when considering a refinance </li></ul><ul><li>FHA Refinance Options </li></ul><ul><ul><li>Rate and Term Refinance </li></ul></ul><ul><ul><li>Cash Out Refinance </li></ul></ul><ul><ul><li>Streamline Refinance </li></ul></ul><ul><li>Wrap Up and Take Aways </li></ul>
  • 4. A Complete Guide to FHA Refinance Loan Options <ul><li>Ask Questions throughout presentation </li></ul><ul><ul><li>You may type questions in at any time during the presentation – Questions box on your screen </li></ul></ul><ul><ul><li>Home loan specialists are standing by to answer your questions during the presentation </li></ul></ul><ul><ul><li>The only dumb question is the one you don’t ask </li></ul></ul><ul><li>Write number down now in case you get disconnected </li></ul><ul><ul><li>1-866-667-6724 </li></ul></ul>
  • 5. A Complete Guide to FHA Refinance Loan Options <ul><li>Empowering you to make educated decisions about your refinance </li></ul><ul><li>Refinancing your home is a serious financial decision that requires careful consideration </li></ul><ul><li>The information you will receive here today will help you to see through common advertising and marketing tactics and enable you to make sound financial decisions about your family’s greatest investment….Your home. </li></ul>
  • 6. A Complete Guide to FHA Refinance Loan Options <ul><li>Establishing your motivation </li></ul><ul><li>3 motivations for refinancing </li></ul><ul><ul><li>Reduce monthly payment - Save money </li></ul></ul><ul><ul><li>Reduce term of loan - Pay off earlier </li></ul></ul><ul><ul><li>Cash out – Pay off bills / Home Improvement </li></ul></ul><ul><li>Common misperceptions about refinancing </li></ul><ul><ul><li>Reducing monthly payments will save you money </li></ul></ul><ul><ul><li>You must reduce the term to pay loan off early </li></ul></ul><ul><li>Many lenders may not tell you this part….. </li></ul>
  • 7. A Complete Guide to FHA Refinance Loan Options <ul><li>Performing a Cost / Benefit analysis </li></ul><ul><li>Reducing your monthly payment </li></ul><ul><ul><li>There is always a cost to refinancing </li></ul></ul><ul><ul><li>“ Resetting” your term may lower your payments but cost you thousands </li></ul></ul><ul><ul><li>“ Red Flag” if a lender does not explore your motivation or discuss cost / benefit analysis </li></ul></ul><ul><li>Cost Benefit Analysis Example </li></ul><ul><ul><li>Bought 2 years ago for $200,000 </li></ul></ul><ul><ul><li>$195,200 Loan Amount currently </li></ul></ul><ul><ul><li>6.25% Interest Rate </li></ul></ul><ul><ul><li>$1,231.43 payment – Principle and Interest only </li></ul></ul>
  • 8. A Complete Guide to FHA Refinance Loan Options <ul><li>Performing a Cost / Benefit analysis </li></ul><ul><li>First, let’s take a look at the “Benefit” </li></ul><ul><ul><li>New Interest Rate – 5.25% </li></ul></ul><ul><ul><li>New Payment - $1,115.45 – Over $115 a month! </li></ul></ul><ul><ul><li>That’s a Savings of over $41,400 over the term of the loan! (30 year fixed) </li></ul></ul><ul><ul><li>Sounds not too bad right? Maybe, maybe not </li></ul></ul>
  • 9. A Complete Guide to FHA Refinance Loan Options <ul><li>Performing a Cost / Benefit analysis </li></ul><ul><li>Next, let’s look at the estimated “Cost” </li></ul><ul><ul><li>New Loan Amount - $202,000 </li></ul></ul><ul><ul><ul><li>Origination/Discount 1% - $2,020 </li></ul></ul></ul><ul><ul><ul><li>Processing/Underwriting - $795 </li></ul></ul></ul><ul><ul><ul><li>Lender / Broker fees - $995 </li></ul></ul></ul><ul><ul><ul><li>Title / Escrow / Notary - $1,100 </li></ul></ul></ul><ul><ul><ul><li>Interim Interest 15 days - $435 </li></ul></ul></ul><ul><ul><ul><li>Escrow Account – Depends on time of year </li></ul></ul></ul><ul><ul><ul><ul><li>Taxes – 7 months - $1,500 </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Insurance – 2 months - $85 </li></ul></ul></ul></ul><ul><ul><li>Actual costs may vary – This is realistic </li></ul></ul>
  • 10. A Complete Guide to FHA Refinance Loan Options <ul><li>Performing a Cost / Benefit analysis </li></ul><ul><li>And finally, the Analysis </li></ul><ul><ul><li>Old Loan amount of $195,200 </li></ul></ul><ul><ul><ul><li>$1,231.43 paid for remaining 336 months </li></ul></ul></ul><ul><ul><ul><li>Total pay off - $413,760.48 </li></ul></ul></ul><ul><ul><li>New Loan amount of $202,000 </li></ul></ul><ul><ul><ul><li>$1,115.45 paid over 360 months </li></ul></ul></ul><ul><ul><ul><li>Total pay off – 401,562.00 </li></ul></ul></ul><ul><ul><li>Actual life of loan Savings is $12,198.48 </li></ul></ul><ul><ul><ul><li>$33.89 actual monthly savings </li></ul></ul></ul>
  • 11. A Complete Guide to FHA Refinance Loan Options <ul><li>Performing a Cost / Benefit analysis </li></ul><ul><li>Paying off home sooner – Reduce term </li></ul><ul><ul><li>There is always a cost to refinancing </li></ul></ul><ul><ul><li>“ Red Flag” if a lender does not explore your motivation or discuss cost / benefit analysis </li></ul></ul><ul><li>Cost Benefit Analysis Example </li></ul><ul><ul><li>Bought 2 years ago for $200,000 </li></ul></ul><ul><ul><li>Have 30 year fixed now </li></ul></ul><ul><ul><li>$195,200 Loan Amount currently </li></ul></ul><ul><ul><li>6.25% Interest Rate </li></ul></ul><ul><ul><li>$1,231.43 payment – Principle and Interest only </li></ul></ul>
  • 12. A Complete Guide to FHA Refinance Loan Options <ul><li>Performing a Cost / Benefit analysis </li></ul><ul><li>First, let’s take a look at the “Benefit” </li></ul><ul><ul><li>New Interest Rate – 5.00% </li></ul></ul><ul><ul><li>New Payment - $1,597.40 </li></ul></ul><ul><ul><ul><li>Only $365.97 increase </li></ul></ul></ul><ul><ul><ul><li>Pay off home in half the time! </li></ul></ul></ul><ul><ul><li>Sounds not too bad right? Maybe, maybe not </li></ul></ul>
  • 13. A Complete Guide to FHA Refinance Loan Options <ul><li>Performing a Cost / Benefit analysis </li></ul><ul><li>Next, let’s look at the estimated “Cost” </li></ul><ul><ul><li>New Loan Amount - $202,000 </li></ul></ul><ul><ul><ul><li>Origination/Discount 1% - $2,020 </li></ul></ul></ul><ul><ul><ul><li>Processing/Underwriting - $795 </li></ul></ul></ul><ul><ul><ul><li>Lender / Broker fees - $995 </li></ul></ul></ul><ul><ul><ul><li>Title / Escrow / Notary - $1,100 </li></ul></ul></ul><ul><ul><ul><li>Interim Interest 15 days - $435 </li></ul></ul></ul><ul><ul><ul><li>Escrow Account – Depends on time of year </li></ul></ul></ul><ul><ul><ul><ul><li>Taxes – 7 months - $1,500 </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Insurance – 2 months - $85 </li></ul></ul></ul></ul><ul><li>Reducing the term does not reduce costs </li></ul>
  • 14. A Complete Guide to FHA Refinance Loan Options <ul><li>Performing a Cost / Benefit analysis </li></ul><ul><li>And finally, the Analysis </li></ul><ul><ul><li>New Loan amount of $202,000 </li></ul></ul><ul><ul><ul><li>$1,597.40 paid over 180 months </li></ul></ul></ul><ul><ul><ul><li>Total pay off – $287,532 </li></ul></ul></ul><ul><ul><li>Old Loan amount of $195,200 </li></ul></ul><ul><ul><ul><li>Total pay off - $413,760.48 </li></ul></ul></ul><ul><ul><ul><li>Interest Savings of - $126,228.48! </li></ul></ul></ul><ul><ul><ul><li>OR…..Increase payment to $1,597.40 </li></ul></ul></ul><ul><ul><ul><li>Pay $7,000 cost toward loan - $188,200 </li></ul></ul></ul><ul><ul><ul><li>Pays off home in 183 months </li></ul></ul></ul><ul><ul><li>Now you can make an educated decision! </li></ul></ul>
  • 15. A Complete Guide to FHA Refinance Loan Options <ul><li>FHA Refinance Loan Basics </li></ul><ul><li>2009 FHA Loan Limits </li></ul><ul><ul><li>Based on MSA – from $362,790 to $625,500 </li></ul></ul><ul><ul><li>“ FHA Jumbo” is anything above $417,000 </li></ul></ul><ul><ul><ul><li>Results in slightly higher interest rates </li></ul></ul></ul><ul><li>Owner occupied only - 1-4 units ok </li></ul><ul><li>Loan limits increased for 2,3,4 units </li></ul><ul><ul><li>Limits determined by MSA – Call for details </li></ul></ul><ul><li>All FHA loans require full documentation meaning W2’s and/or Tax Returns </li></ul>
  • 16. A Complete Guide to FHA Refinance Loan Options <ul><li>FHA Refinance Loan Basics </li></ul><ul><li>FHA Loans require 2 types of Mortgage Insurance Premiums - MIP </li></ul><ul><ul><li>Upfront Mortgage Insurance Premium </li></ul></ul><ul><ul><ul><li>1.75% of Loan Amount </li></ul></ul></ul><ul><ul><ul><li>Can be financed into loan amount </li></ul></ul></ul><ul><ul><li>Monthly Mortgage Insurance Premium </li></ul></ul><ul><ul><ul><li>.55% of Loan Amount </li></ul></ul></ul><ul><ul><ul><li>Included in monthly payment </li></ul></ul></ul><ul><ul><ul><li>Included on mortgage statement </li></ul></ul></ul><ul><ul><li>MIP required for minimum 5 years </li></ul></ul><ul><ul><ul><li>LTV must be 78% or less to remove </li></ul></ul></ul>
  • 17. A Complete Guide to FHA Refinance Loan Options <ul><li>FHA Refinance Loan Basics </li></ul><ul><li>Calculating your MIP Payment - Example </li></ul><ul><ul><li>$200,000 Loan amount x .55% = $1,100 </li></ul></ul><ul><ul><li>Divided by 12 = $91.67 MIP </li></ul></ul><ul><li>30 day Mortgage lates in the past are ok with compensating factors </li></ul><ul><ul><li>High credit scores </li></ul></ul><ul><ul><li>Months of reserves </li></ul></ul><ul><ul><li>Low debt to income ratio </li></ul></ul><ul><ul><li>Detailed letter of explanation </li></ul></ul><ul><li>Must be current for month of refinance </li></ul>
  • 18. A Complete Guide to FHA Refinance Loan Options <ul><li>FHA Refinance Loan Programs </li></ul><ul><li>Rate and Term Refinance </li></ul><ul><ul><li>Can include closing costs in loan only </li></ul></ul><ul><li>Cash Out Refinance </li></ul><ul><ul><li>Can include closing costs and get cash out </li></ul></ul><ul><li>FHA Streamline Refinance – FHA to FHA </li></ul><ul><ul><li>*”No fees” included in loan - no appraisal </li></ul></ul><ul><ul><li>Fees included in loan - appraisal required </li></ul></ul>
  • 19. A Complete Guide to FHA Refinance Loan Options <ul><li>FHA Refinance Loan Options </li></ul><ul><li>Rate and Term Refinance </li></ul><ul><li>Credit Score Requirements </li></ul><ul><ul><li>580 Minimum Credit Score as a guideline </li></ul></ul><ul><ul><li>Can go lower on exception basis </li></ul></ul><ul><ul><li>620 Minimum Credit Score – “FHA Jumbo” </li></ul></ul><ul><ul><ul><li>Loan amount over $417,000 </li></ul></ul></ul><ul><li>Maximum Loan to Value 97% LTV </li></ul><ul><ul><li>Before upfront Mortgage Insurance Premium </li></ul></ul><ul><li>FHA to FHA use Streamline Program </li></ul>
  • 20. A Complete Guide to FHA Refinance Loan Options <ul><li>FHA Refinance Loan Options </li></ul><ul><li>Cash Out Refinance </li></ul><ul><li>Credit Score Requirements </li></ul><ul><ul><li>580 Minimum Credit Score as a guideline </li></ul></ul><ul><ul><li>Can go lower on exception basis </li></ul></ul><ul><ul><li>620 Minimum Credit Score – “FHA Jumbo” </li></ul></ul><ul><ul><ul><li>Loan amount over $417,000 </li></ul></ul></ul>
  • 21. A Complete Guide to FHA Refinance Loan Options <ul><li>FHA Refinance Loan Options </li></ul><ul><li>Cash Out Refinance </li></ul><ul><li>Maximum Loan to Value 95% </li></ul><ul><ul><li>Up to loan amount of $417,000 </li></ul></ul><ul><ul><li>Must have owned 12+ months </li></ul></ul><ul><ul><li>1-2 unit properties only </li></ul></ul><ul><ul><li>No more than 1 x 30 late in 12 months </li></ul></ul><ul><ul><ul><li>Current now </li></ul></ul></ul><ul><li>Maximum Loan to Value 85% </li></ul><ul><ul><li>Loan amount over $417,000 </li></ul></ul><ul><ul><li>Owned home less than 12 months </li></ul></ul>
  • 22. A Complete Guide to FHA Refinance Loan Options <ul><li>FHA Refinance Loan Options </li></ul><ul><li>FHA Streamline </li></ul><ul><li>Can only be used for Rate & Term and must benefit the borrower with rate reduction </li></ul><ul><li>Can only be used if existing loan is FHA refinancing into FHA loan </li></ul><ul><li>No income or asset documentation required </li></ul><ul><li>Two Streamline Options Available </li></ul><ul><ul><li>No fees included in loan - No appraisal </li></ul></ul><ul><ul><li>Fees paid through loan - Appraisal required </li></ul></ul>
  • 23. A Complete Guide to FHA Refinance Loan Options <ul><li>FHA Refinance Loan Options </li></ul><ul><li>FHA Streamline – Fees not included </li></ul><ul><ul><li>Refinanced loan amount can not exceed current principle balance </li></ul></ul><ul><ul><li>You will bring in money to escrow for impounds and interim interest </li></ul></ul><ul><ul><ul><li>Next month’s payment should cover </li></ul></ul></ul><ul><ul><li>Lender can provide “credit” to cover escrow and title insurance policy </li></ul></ul><ul><ul><li>No income or asset documentation required </li></ul></ul><ul><ul><li>No appraisal required </li></ul></ul><ul><ul><li>No limit on subordinate financing as long as loan remains in 2 nd lien position </li></ul></ul>
  • 24. A Complete Guide to FHA Refinance Loan Options <ul><li>FHA Refinance Loan Options </li></ul><ul><li>FHA Streamline – Fees Included </li></ul><ul><ul><li>Refinanced loan amount can include closing costs including title, escrow, impounds, interim interest and lender fees </li></ul></ul><ul><ul><li>Lender can provide “credit” to assist with closing costs </li></ul></ul><ul><ul><li>No income or asset documentation required </li></ul></ul><ul><ul><li>Appraisal required </li></ul></ul><ul><ul><li>No limit on subordinate financing as long as loan to value does not exceed 97% </li></ul></ul>
  • 25. A Complete Guide to FHA Refinance Loan Options <ul><li>Only use an FHA Approved lender! </li></ul><ul><li>Many illegal “Branch” companies that are not approved to originate FHA loans </li></ul><ul><li>Check official HUD website for approval status of lender - will provide link on site </li></ul><ul><ul><li>http://www.hud.gov/ll/code/llslcrit.cfm </li></ul></ul><ul><li>“ Red Flags” include – a different company name and/or address on page 3 of loan application. </li></ul>
  • 26. A Complete Guide to FHA Refinance Loan Options <ul><li>Wrap up and Take Aways </li></ul><ul><ul><li>We are a direct Lender that specializes in FHA Refinance, Streamline and Purchase loans. </li></ul></ul><ul><ul><li>We are a direct Lender that specializes in CalSTRS, CalPERS, CalHFA, VA, Conventional and Jumbo Loans </li></ul></ul><ul><ul><li>We are more than happy to be your “second opinion” if you are already working with someone </li></ul></ul><ul><ul><li>We are committed to educating and empowering homeowners - Join us for future classes </li></ul></ul>
  • 27. A Complete Guide to FHA Refinance Loan Options <ul><li>Wrap up and Take Aways </li></ul><ul><ul><li>You will receive a “Thank you” email with links to the information we’ve talked about here today </li></ul></ul><ul><ul><ul><li>Copy of power point presentation </li></ul></ul></ul><ul><ul><ul><li>Link to search HUD approved lenders </li></ul></ul></ul><ul><ul><ul><li>“ What’s my home worth?” – Value analysis </li></ul></ul></ul><ul><ul><ul><li>Secure on-line loan application </li></ul></ul></ul><ul><ul><li>Simple, online form for requesting a no-cost, no obligation Cost/Benefit analysis on your loan </li></ul></ul><ul><ul><ul><li>Have your latest mortgage statement handy </li></ul></ul></ul>
  • 28. Upcoming Home Buyer Classes <ul><li>A Complete Guide to Buying Foreclosures and Short Sales </li></ul><ul><li>Real Estate Agent Round Table </li></ul><ul><ul><ul><li>Open Q&A with Experienced Buyer’s Agents talk about buying home in this market </li></ul></ul></ul><ul><li>A Complete Guide to FHA Purchase Loans </li></ul><ul><li>A First Time Home buyer’s Complete Guide to Closing Costs and the Good Faith Estimate </li></ul><ul><li>Check back often for upcoming classes </li></ul>
  • 29. Thank you for Attending Please Join us for one of our other educational home buyer classes Presented By: Broadview Mortgage Corp. Presenter: Scott Schang Contact Information: Phone: 866-667-6724 [email_address]

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