Reduced FHA Refi Fees

It looks like the White House is trying to help more homeowners refinance again. The new initiative will allow FHA Borrowers to refinance at lower costs if you received your FHA insured mortgage prior to June 1, 2009. The White House is estimating between 2 and 3 million borrowers would benefit from the reduction of fees.

These loans will have the same benefits as a traditional FHA streamline refinance:

• no verification of income
• no verification of employment
• or credit
• and most importantly they do not require a new appraisal on the property, which mean the underwater borrowers still have the opportunity to Refinance to historical low rates.

Reductions for the new rule:

Upfront Mortgage insurance premium: from 1% of the loan amount to .01%

• eg. $200,000 loan amount
• Upfront 1% - $2000 Upfront .01% $20.00

Annual mortgage insurance premium: from 1.15% of the loan amount to .55%

• eg. $200,000
• Annual MIP 1.15% - $2300.00 yearly/$191.67 monthly
• Annual MIP .55% - $1100.00 yearly/$91.67 monthly