Are you on the hunt to refinance your home loan? If you are looking for a better rate or are looking to refinance an FHA home loan could be the perfect option for your financial situation.
Refinancing your home loan could save you thousands and if you are looking to explore the option it’s important to see what the types of refinance loans are available to you.
No matter your home loan finance goals, there is a loan to suit your needs – if you take the time to check out all the options.
What is an FHA Loan?
An FHA loan is backed by the government and insured by the Federal Housing Administration. Perfect for first home buyers, an FHA Loan is perfect if you have a low credit score or if you don’t have a large down payment compared to standard home loans.
Qualifying for an FHA Loan is fairly straightforward with low scores required and around 10% deposit on average. FHA Loan borrowers will need to pay for mortgage insurance which protects the lender in the case you default the loan so you will need to keep this in mind when doing your budget.
Types of FHA Refinance loans
Outlined below are three of the types of FHA refinance loans available:
- FHA Refinance Loan – this loan is available for anyone and works like the traditional refinancing loan only the loan insurance is provided by the FHA. This loan allows you to decrease your interest rate and monthly repayment so you can get on top of your monthly expenses.
- FHA Cash Out Refinancing Loan – this loan allows for the borrower to apply for a greater amount than the balance of your mortgage so you can use the extra money to spend on your home improvement or other expenses including college education. To be eligible you must have an original loan from FHA.
- FHA Streamlined Refinancing Loan – if you’re looking to lower your interest rate this FHA refinancing loan could be the perfect solution. The lender can re-use your original FHA paperwork and lower your interest rate to allow you to pay off your loan sooner. Refinance and reduce your payments without the need for a credit check.
There are plenty of reasons why you should explore the option of an FHA Refinance loan, and if you are looking to gain access to low-interest rates, reduce your monthly mortgage payments and fix up your bad credit an FHA refinancing loan could be the way to do it!