Financing in 95630>Question Details

Dave, Real Estate Pro in Folsom, CA

FHA refinance - streamline vs regular

Asked by Dave, Folsom, CA Fri Jul 16, 2010

For a property purchased 2 months ago, what are the refinance options?
1. FHA streamline
2. FHA regular
3. Would there be a difference in UFMIP % for #1 vs #2 above?
4. Would there be an appraisal required?
5. During refinance, do we get 100% refund/credit of current escrow account?
6. During refinance, do we get 97-99% refund/credit of UFMIP paid for FHA the first time?

Your expert opinion is highly appreciated

Many thanks!!!

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Gregorio is correct on all points addressed for an FHA Streamline. It wouldn't make sense to choose differently than a Streamline option. You can either go with or without an appraisal option.
0 votes Thank Flag Link Fri Jul 16, 2010
Why would you pay all the fees for a standard FHA refinance when you could get a streamline?
You also have to look at how much you are increasing your loan amount and divide the monthly savings into that to get a better idea of a break even. Without knowing your situation I cannot say, what I am saying is that there is no reason to do a standard FHA refinance if you already have an FHA loan. Currently you need to wait 6 months to do so.
Web Reference: http://WeFixRates.Com
0 votes Thank Flag Link Fri Jul 16, 2010
The only reason for considering that is because my current rate is 5.5% and the new rate I'm getting is 4.5%. So, my payment is actually getting reduced by $300/- even if my principal balance will increase (due to UFMIP and closing costs being added to the principal.

If the above is true, do you still think that it doesn't make financial sense?
0 votes Thank Flag Link Fri Jul 16, 2010
The monetary savings are reduced lender fees and no appraisal. In addition to those savings, it's designed to be "low doc" so you won't have to resubmit all the documents you did the first time.

There would be no reason to do a standard FHA refinance if you currently have an FHA loan.
Web Reference: http://WeFixRates.Com
0 votes Thank Flag Link Fri Jul 16, 2010
Thanks. I'll wait for a few others to provide their expert opinion.

BTW, what are the monetary savings in doing FHA streamline vs FHA regular refinance?
0 votes Thank Flag Link Fri Jul 16, 2010
1. You need to have made 6 payments to do a streamline
2. The cost would not make sense for you to do this
3. The UFMIP is 2.25% regardless
4. After you have made 6 payments, you can do a streamline without an appraisal, but it will most likely require that you bring cash to close.
5. After you close the refinance, your escrow impounds are refunded from the previous lender
6. No, after 6 payments you would get 70% of the original UFMIP refunded

Gregorio Denny
Tripoint Mortgage Group, Inc.
800-335-6897
Web Reference: http://WeFixRates.Com
0 votes Thank Flag Link Fri Jul 16, 2010
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