Mortgage rates have dipped again, and Government loan mortgage rates are now nearing the lowest levels we’ve seen – again! Lower interest rates mean folks are thinking about refinancing their homes. Especially folks who didn’t have the ability to refinance it within the last couple of years!
FHA allows you to Streamline Refinance when you do not occupy the property. This was actually news to me, because we always tell folks that FHA is ONLY for use as a Primary Residence!
So we have a borrower who owned a home in Ohio (financed via FHA), moved to NC – but could not sell the home in Ohio. They purchased a home in NC while renting the other one out.
The rate on their home in Ohio is 6.25% – which is a good rate… except that FHA rates have DROPPED so much right now, they wanted to see if they could get a little better position!
Turns out we can save them $275 a month, AND keep it a FHA Loan! Yeah!
Here’s the deal for a Refinance of Investment Property. It must be a FHA Streamline Refinance, meaning:
- no appraisal
- no increase in the base loan amount
- must pay the closing costs out of pocket
- the lender CAN par price the loan to pay some of the costs
- can NOT remove a co-signor
We’ve talked to folks who said their Bank would not allow a FHA Streamline Refinance if they no longer lived in the home. We can definitely do these loans, it’s an easy process, and it saves you thousands of dollars! It WILL likely cost you some out of pocket expenses, because there are requirements regarding what costs we can pay and what you MUST pay – however, Winter is the cheapest time to refinance a home, because the taxes for the property were just paid.
This is seriously good news if you have what is now Investment Property that has a FHA loan on it! If you want to see if we can help you lower your payments with a refinance, call Steve and Eleanor Thorne, Mortgage Banker in Cary 919-649-5058
So there are different costs associated with streamline refi “owner occupied” and “non owner occupied” (the latter being slightly more expensive)?
Rate is slightly different but there are no additional costs.