OK Finance Gurus.

[GSXTacy]

I currently have a FHA mortgage for 88K at 6.75%. There is a program called Streamlining That reduces the interest rate at almost no cost to me. It sounds pretty good and have talked to one lender. He says the program states that I can streamline 3 times a year till im at my prime, no more than half a percent at a time. They say its cheap because I pay no points, there is no appraisal, title search or any of that type of stuff involved. So they tell me, at no cost to me I can go to a 6.25 30 year fixed for the next 4 months, then the next I can streamline again to 5.75, again a 30 year fixed. After 4 months do it again. The good thing is that each time I will be in a fixed loan so if the interest rates jump up, I'm safe, I dont have to streamline.

Here is the link to the program

http://www.hud.gov/offices/hsg/sfh/buying/streamli.cfm

Anyone used this or work with this before? Thanks for the input.

[runeight]

Intrest rates for refi will be coming down. Keep a keen eye on rates, refi to a 15 year fixed. Usually no charge or a little fee.

r8

[WHIPKRAKR]

Never done anything like that. Our mortgage company offers a program to break our big monthly payment into a couple of smaller electronic payments (scheduled on the dates we want). With their program - over the long run it shaves several years of payments off and saves quite a bit in interest. Quick, easy set up for us

[twotonevert]

I did that a few years ago with the ex's house, streamlined from a 30 to a 15 year, payment went up very little. I thought it was a good program. But we could only do it every two years. Not sure about the program you are looking at.

[99'busa]

I am also at a point to make a decision I hope some gurus have some advise on this

[Fate]

I have seen them but don't know alot about the program. The fed is making another cut of .75 so hold out to refi. Once this next drop happens, don't expect another. History shows that this will actually effect the market in a negative way. Give it a couple weeks then lock a rate.

[Mr Bogus]

so how much will a .75 cut make in FHA rates? I have been trying to be patient before I refi (no cash back) but I am getting antsy...

[BusaWhipped]

Talk to your dad

[ZbornacSVT]

I am in the middle of doing a cash out now. A drop in the Fed generally raises the mtg rates I was offered 6% at the end of the day today, but I am still holding out.

When the full point Fed drop was rumored yesterday, my offer went from 5.875% to 6.25% just like that. From what I have heard, some stuff is happening at the white house level to help us refi guys out....

[99'busa]

[Fate]

Originally Posted by Mr Bogus @ Mar. 19 2008, 6:25 PM

so how much will a .75 cut make in FHA rates? Â* I have been trying to be patient before I refi (no cash back) but I am getting antsy...

Actually it will not help. The rates have come down a .25 Normally when the fed does this it will stimulate the economy which can actually effect mortgages negatively. The rates will start rising soon but you may see a small drop in the next week before they start going up again. This happens because Fed rate cuts help to stimulate the economy, by making it less expensive to finance personal and business purchases...and this in turn fuels inflation, the arch-enemy of fixed return assets like Bonds, which home loan rates are based on. Everytime this is done by the Fed, our dollar drops in value and now we have had an increase of 18% in fuel costs. The rates went up from the SHOCK of what the fed did, The rate will drop a little, then jump up. This is the 6th time they have done this since September. We will probably see an increase of around 1% by summer on home mortgage rates. But your credit card rates may drop a little so you can spend more $$. The less our dollar is worth, the more oil will cost which means look forward to more increases in Fuel costs too.

[Fate]

Originally Posted by ZbornacSVT @ Mar. 19 2008, 6:34 PM

I am in the middle of doing a cash out now. Â*A drop in the Fed generally raises the mtg rates I was offered 6% at the end of the day today, but I am still holding out.

When the full point Fed drop was rumored yesterday, my offer went from 5.875% to 6.25% just like that. Â*From what I have heard, some stuff is happening at the white house level to help us refi guys out....

There are some programs to bail out people in arms under discussion. I am in one myself and have seen an increase of $500 a month on my house. I hate to say it, but I knew I was taking the risk when I got into my loan and It is my fault for taking a risky loan. The Gov. bailing us out is only going to hurt is in the long run. They need to get the economy straightened out first. If you can get a 30 year fix or an arm with an adjustment cap (while the arm is low enough to make it worth it), you are better off. Do something quick. If you wait you are going to see a huge increase in rates.

[Fate]

Originally Posted by twotonevert @ Mar. 19 2008, 1:13 PM

I did that a few years ago with the ex's house, streamlined from a 30 to a 15 year, payment went up very little. I thought it was a good program. But we could only do it every two years. Not sure about the program you are looking at.

You can actually set the program up yourself. You are applying extra money to your principle each month, they just charge you to do what you can do yourself.

[Mr Bogus]

Thanks Fate, I guess I should have hopped at the first of the year when they were down almost .75...

Now if I go from a 30 FHA to a 30 year conforming.. I looks like I could take at least a full point off my rate.. does that make more sense?

[Fate]

Originally Posted by Mr Bogus @ Mar. 20 2008, 12:53 PM

Thanks Fate, Â*I guess I should have hopped at the first of the year when they were down almost .75...

Now if I go from a 30 FHA to a 30 year conforming.. I looks like I could take at least a full point off my rate.. does that make more sense?

A point is actually alot. I do not know the program, but if there is not any closing costs or other points, you are doing good. I hate it when people talk APR's and are all rate driven when buying when I was working as an agent. Most companies are close to the same, where they stick you are closing costs. Paying 5 grand more in points and closing costs to get a rate of a small percent lower is how mortgage companies screw the public. You would save a little under $300 a month with a percent lower point than you currently have. I would jump on that.

[Fate]

Rates are around 5.75 today too. Might want to call your guy Friday and check to see if your 6.25 is lower right now too.

[Wag]

Quotes are from the link you posted. Confirms what I thought I knew about streamlining.

<div class="iF-Passage"><div class="QUOTEHEAD">Quote:</div><div class="QUOTE clearfix"><span class="quoteBegin"> </span>
Lenders may offer streamline refinances and include the closing costs into the new mortgage amount.[/quote]

You actually DO pay closing costs but they are rolled up into the new principal amount. The only thing you don't have to do is write a check at the signing. But you DO pay the same costs PLUS you pay interest on those costs. In the long run you pay more. The only reason for doing the streamline is if the numbers add up to get you paying less out of pocket every month.

<div class="iF-Passage"><div class="QUOTEHEAD">Quote:</div><div class="QUOTE clearfix"><span class="quoteBegin"> </span>
This can only be done if there is sufficient equity in the property, as determined by an appraisal. Streamline refinances can also be done without appraisals, but the new loan amount cannot exceed the original loan amount.[/quote]

Note, if your equity has fallen below a certain point, you may not be able to do this.

If you're planning to move in five years or so, a streamline is probably a good idea. If you're planning to stay in the house for 30 years, then check the numbers.

Having said all of that, however, here's the biggest problem with a streamline: It gets refinanced for an additional 30 years. In other words, you start over. If you are two years into your current mortgage, you MIGHT be better off sticking with it. Run the numbers and find out.

I'm pretty sure that they do NOT refinance and keep you at the same point of your loan. In other words, if you have 26 years left on your current mortgage, they will not write the new one as a 26 year mortgage. Ultimately, you'll end up paying more, again, in the long run.

Also, at some point, you may wish to go conventional, just because the interest rates are so much lower than FHA. See if you qualify for that kind of loan. They will roll the costs into the note too if you ask.

The trick with this kind of things is to run the numbers and COMPARE! If you need help running the numbers, let me know.

--Wag--

[Homebrew]

GSXTracy

My wife has been in the biz for over 25 years and can do loans
all over the US
Go to her website Jillunderwood.com you can email her or call
She's A Great Gal and Knows her stuff

[Fate]

Originally Posted by Wag @ Mar. 21 2008, 3:29 AM

Quotes are from the link you posted. Â*Confirms what I thought I knew about streamlining.

<div class="iF-Passage"><div class="QUOTEHEAD">Quote:</div><div class="QUOTE clearfix"><span class="quoteBegin"> </span>
Lenders may offer streamline refinances and include the closing costs into the new mortgage amount.

You actually DO pay closing costs but they are rolled up into the new principal amount. Â*The only thing you don't have to do is write a check at the signing. Â*But you DO pay the same costs PLUS you pay interest on those costs. Â*In the long run you pay more. Â*The only reason for doing the streamline is if the numbers add up to get you paying less out of pocket every month.

<div class="iF-Passage"><div class="QUOTEHEAD">Quote:</div><div class="QUOTE clearfix"><span class="quoteBegin"> </span>
This can only be done if there is sufficient equity in the property, as determined by an appraisal. Streamline refinances can also be done without appraisals, but the new loan amount cannot exceed the original loan amount.[/quote]

Note, if your equity has fallen below a certain point, you may not be able to do this.

If you're planning to move in five years or so, a streamline is probably a good idea. Â*If you're planning to stay in the house for 30 years, then check the numbers.

Having said all of that, however, here's the biggest problem with a streamline: Â*It gets refinanced for an additional 30 years. Â*In other words, you start over. Â*If you are two years into your current mortgage, you MIGHT be better off sticking with it. Â*Run the numbers and find out. Â*

I'm pretty sure that they do NOT refinance and keep you at the same point of your loan. Â*In other words, if you have 26 years left on your current mortgage, they will not write the new one as a 26 year mortgage. Â*Ultimately, you'll end up paying more, again, in the long run.

Also, at some point, you may wish to go conventional, just because the interest rates are so much lower than FHA. Â*See if you qualify for that kind of loan. Â*They will roll the costs into the note too if you ask.

The trick with this kind of things is to run the numbers and COMPARE! Â*If you need help running the numbers, let me know.

--Wag--[/quote]
I have not dealt with FHA loans for a long time, but from my understanding, they have been set up recently in a way that they are very competitive with conventional Fanny Mae Programs to help out people in bad situations.

[Wag]

Originally Posted by Fate @ Mar. 21 2008, 7:28 AM

I have not dealt with FHA loans for a long time, but from my understanding, they have been set up recently in a way that they are very competitive with conventional Fanny Mae Programs to help out people in bad situations.

Yeah, after I posted all that I was thinking it had been about 8 years since the last time I dealt with an FHA loan and that the landscape may have changed. Back then, it was about 1.5 to 2.0% difference. Well worth the effort to qualify.

The bigger issue was the insurance premium kickin' the payment up there.

--Wag--