How long will you be in the home?
There's quite a few side-by-side comparisons for FHA and Conventional loans.
6.125% is pretty good. to effectively pay it down, see if you can pay in bi-weekly payment and the lender apply it right away to reduce the nominal interest.
More than a year after your initial request. At this point I would doubt you would benefit by doing a refi to FHA. On a 30 year FHA loan you have Up Front Mortgage Insurance and monthly Mortgage Insurance payments as well. That with the FHA closing cost it would not be beneficial to refinance. Look at how long it would take to recoup the cost. Of course in today's environment there are problems with properties appraising low, you may not qualify or have to pay your current mortgage down.
PS' some said do a streamline FHA. Can't be done!. FHA to FHA only..
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I just spoke with a lender that our office has been working with. And there are a few questions and comments that I can offer you. Assuming that your property appraises out you could do an FHA loan as long as the property has at least 5% equity in, so you would not be forced to pay down the loan to 90% unless you wanted to. To get an FHA loan, your condo association must have been turned over to the owners of the units for at least one year, and the building would need to be FHA approved. If the building is not yet FHA approved, then you might be able to get a "spot" approval to do the loan. You can check to see if your building is on the FHA's list of approved properties at http://www.hud.gov. You can contact Ed Rodriguez with Bank of America at 773-316-0132 (cell) or 630-941-6983 (off) or at email@example.com. Good luck to you.
Broker Associate, Sudler Sotheby's International Realty
The short answer would be probably not - but it depends. I'm in the same boat except underwater so I have no opportunity to refinance my condominium. If it were me, the first step (and most important) is to run the math on refinancing assuming FHA financing @ 95% and all other loan criteria being superior (credit, debt ratios, assets etc). If the after tax savings is positive after the cost of the loan, then the refinance if beneficial. Step 2, I would have a CMA completed to determine current market value. if you were then still at 95% LTV or better based on solid comps within the CMA, there may be an option to refinance. FHA would only be viable if the condo project is already on the approved list of developements with FHA or if the building could meet spot-loan specifications. Step 3, check the language within the bylaws of the association documents. If there is anything stating that the "association retains first right of refusal", the bylaws would have to be ammended and that verbiage would have to come out. That is very unlikely to happen. However, if there is no language indicative of the first right of refusal belonging to the association, the first 3 hurdles have been surpassed. We can then move forward in tackling the rest.
I would be obliged to do all the math for you on this David but through a private email. Let me know if we can help. We appreciate you as a consumer and customer alike.
I would be happy to take a look and try to help you. Your risk if the scenario does not fit would be about $350 for the cost of the appraisal (FHA appraisal). I am dealing with quite a few people in your type of situation so iIdo have a good deal of experience at this. Click on my profile for contact informtaion if you would like speak with me. Good Luck!