You might be able to lower your mortgageA Mortgage is a document granting a lien on a home in exchange for financing granted by a lender. The mortgage is the means by which the lender secures the loan and has the ability to foreclose on the home. interestInterest is money charged for the use of borrowed funds. Usually expressed as an interest rate, it is the percentage of the total loan charged annually for the use of the funds. rate with an FHA loanA Loan is an amount of money that is lent to a borrower, who agrees to repay it plus interest..
Q: I was listening to your radio show on WSB Radio this past Sunday. The caller had a mortgage with one of the big banks and he wanted to get his interest rate lowered. He stated he wasn’t behind in his payments but wanted more cashflow for the household.
My rate currently is 5.25 percent and I am current on my mortgage. Can you give me some direction on this?You stated that if you had an FHA loan there was a program he could use to refinance. I missed what that program was called. I have an FHA loan with the same bank and also want to lower my interest rate.
A: The Federal Housing Administration (FHA), which is part of the Department of Housing and Urban Development (HUD) has required its lenders to offer FHA borrowers a streamline refinance. There is no appraisalAn Appraisal is the opinion of an appraiser, who estimates the value of a home at a specific pointA Point is one percent of a loan amount. in time for the purpose of financing or refinancing a home. required for this refinance, so whether you have any or enough equityYour share of ownership in a company. Stockholders are often referred to as equity investors, because they invest in the equity of a company. in the property shouldn’t be a problem.
Because this is a streamline refinance, there should be very few costs. While the lenderA Lender is a person, company, corporation, or entity that lends money for the purchase of real estate. may be lowering the lowering the interest rate on the mortgage, the lender essentially gives you a new loan. The costs of the streamline refinance may be covered by giving you a slightly higher mortgage interest rate or you may end up adding some of those expenses — subject to certain limitations — to the amount you owe on the loan.
Pick up the phone and call your lender today. My real estateReal Estate is land and anything permanently attached to it, such as buildings and improvements. advice to you is if you can lower your interest rate and recover your closing costs in a couple of months through your lower monthly mortgage payments, you will be better off in the long run. But, don’t just go our and refinance your mortgage to get a lower rate, you still have to determine your closing costs and the time remaining on your current mortgage loan to see if refinancing is right for you.