Wells Fargo Denied Your FHA Streamline Refinance: Now What?

When rates are low, many people who have FHA loans are searching for the best program to use to refinance and save some money on their monthly mortgage. One of the most common refinance programs for people who currently have an FHA loan is the FHA streamline refinance. The FHA streamline allows you to refinance your current FHA loan into another FHA loan with minimal paperwork.

FHA Streamline Refinance Guidelines: What You Want To Know

The FHA streamline has published guidelines by HUD – but that doesn’t mean that each lender has those guidelines and only those guidelines. It is very common for each lender to develop some of their own “overlays” to the HUD guidelines – so they are using HUDs official guidelines for the program and then also using their own.

So if Wells Fargo denied your FHA streamline loan, what you will want to do is find out if it was because of a Wells Fargo overlay or if it was because you don’t meet the official HUD guidelines.

If you find that you are in this situation, there are two simple things you can do. 1. Ask Wells Fargo if you don’t meet the criteria due to the official HUD guidelines or one of their overlays or 2. Just shop for another lender and see what they say.

Shopping Multiple Lenders: Get The Best Deal

If Wells Fargo denied your FHA streamline and you didn’t shop multiple lenders – the easies thing to do is probably to just shop multiple lenders and see what the other lenders say. You may be surprised to learn that each lender works slightly differently and in the event that you have been denied by one, it doesn’t necessarily mean that you will be denied by all of them.

Shopping multiple lenders is easy – you can start right here with some local lenders who update their most current mortgage rates available and take the first step to getting qualified today.

Refinancing is Popular When Rates are Low

With home loan and lending rates at historic lows, now is the best time to borrow money to make investments that you have always wanted to make but have been waiting for the right time.

Lending rates are at their lowest since 1961, and aren’t likely to be this low ever again.

Although irresponsible lending and borrowing was one of the causes of the economic breakdown in 2008, borrowing is now one of the best options for those who are looking to make investments that will pay off in the future. The Federal Reserve has announced that they plan to keep interest rates as low as possible through the year 2014, but this does not mean that they will stay down as far as they are now. Rates are almost certain to go up over the next few years, making now the best time to borrow money if you are considering it. Here are three great ways to take advantage of low rates. 

  1. Buy a home, rental property, or second home. With home loan rates as low as they have been in history, there has never been a better time to buy than right now. Loan rates have been cut almost in half since the economic crash, and lenders are pulling out all the stops to make it as easy as possible for buyers to get into the home of their dreams. Little or no money down up front, low interest rates, and low or no closing fees once everything has been said and done are just a few of the ways that lenders are trying to get people to buy in this down economy. If you have the extra income, now is the best time to buy additional properties and use them as rentals or vacation homes. Prices are starting to rise back up, and home values are only going to increase as the housing market is on the mend. If you want to buy, do it now.
  2. Refinancing your home is another great option to help you take advantage of low rates. If you bought a home before 2008, you are likely paying an interest rate that is much higher than what is being offered to home buyers now. If you have a rate that is about 4%, you can contact your lender and ask about their various refinancing programs. For example the HARP refinance program is popular as well as . Look for streamline refinance options, as these are very cheap and quick and will help you start saving hundreds of dollars right away.
  3. Improving your home is one of the other ways that you can take advantage of low rates and still make a profit on your investment. Borrowing money on a home improvement loan is a great way to get a low rate and add value to your home. Consider remodeling the kitchen, adding another bedroom or bathroom, or finishing the basement and adding hardwood floors. All of these improvements can be funded with a home improvement loan and will add significant value to your home if you ever want to sell.

With the low rates that are available now, there has never been a better time to borrow and make your financial dreams a reality. Be sure to shop around with different lenders (and make sure they are FHA and HUD approved because that is a popular loan option) to make sure you are getting the best rates. Start looking for the best rate in your area today with one of our loan officers who is waiting to help you.

FHA 203k Loans: Popular In Arizona

FHA 203k Loans: Popular In Arizona

The FHA 203k mortgage program has become in demand with the recession in the housing market. When a property is owned by the financial institution, chances are that the property may be in need of a little work and the FHA 203k loan is a great option. Some of the frequently asked questions we see about the FHA 203k mortgage program include:

  • What is the Arizona FHA 203K mortgage?
  • How much do you write the contract for a FHA 203k sales contract?
  • Is it easier or harder to qualify for an FHA 203k loan vs. a regular FHA loan?

What is the Arizona FHA 203k mortgage?

The FHA 203k mortgage program in Arizona is a restoration loan that works much like a development loan. The one who is buying the home is able to pay for a home that is in need of repairs and is able to finance the repair work in the mortgage to correct items in the house. The FHA 203k consists of the purchase price of the home plus the construction costs for the work to be performed after close.

An Example Scenario:

$100,000 purchase price of home
$20,000 Repairs Needed (see a list of the most common FHA 203k repairs)
$120,000 Total Loan Amount

How much do you write the contract for a FHA 203k sales contract?

The offer is the purchase price of the dwelling only. You don’t need to include the cost of repairs anywhere in the sales contract or offer. In the above example, the purchase price on the sales contract or offer would be $100,000.

Is it easier or harder to qualify for an FHA 203k loan vs. a regular FHA loan?

The requirements to qualify are the same as a traditional FHA loan. What does it take to qualify for an FHA loan? Generally speaking, a credit score above 620, a good job and a down payment of 3.5%. Of course there are more details to being qualified, but those are the general highlights.

How do I go about finding the right contractor for the work?

It is advised that you work with a general contractor that can perform all needed repair work. Your loan officer can easily help recommend one – they should know at least one good contractor. It is also imperative that the contractor be practiced in FHA guidelines so that they can include any FHA required items in their contract.

This site is for informational purposes only. It is not sponsored or in any way affiliated with the government. If you are in need of a mortgage loan, consult with a licensed mortgage professional. All fair housing and equal housing opportunity laws apply when applying for a mortgage or buying a home. Copyright 2012.