Refinancing to 15 Year FHA

[Anonymous]

My wife has been unemployed for about a year but has recently landed her dream job! So I thought now would be a good time to refinance the mortgage on our house. A couple of things I would like to accomplish:

1. Obtain a lower rate on my mortgage (Current - 30 year fixed, 5.25% FHA loan - Original appraisal at $153,000)
2. Add my wife to the mortgage (We were not married when I purchased the house)
3. Move from a 30 year, to a 15 year loan

With that said, I figured I would lay out my financial condition and take any and all input I can get. It can be anything from advice on what type of loan to not refinancing at all and paying off debt. I'm open to hearing everything.

The bad (Debt):

Account	Balance	Monthly Payment	Interest Rate
Bank of America - Mortgage	$                                145,402.69	$                         1,081.00*	5.25%
Sallie Mae - Me	$                                  17,576.00	$                            276.53	Variable - See chart
BMW USA - Me	$                                      391.64	$                            391.64	N/A - Lease
Sallie Mae - Wife	$                                   4,054.18	$                              59.67	Variable - See chart
Ford - Wife	$                                   9,061.61	$                            229.91	4.74%
Citi Credit Card (Interest Free)	$                                   6,739.89	$                            101.00	0.00% (Until Nov.)

*Includes MIP

Loan	Balance	Interest Rate
Student Loan - Me	$4,323.97	2.36%
Student Loan - Me	$4,354.88	6.80%
Student Loan - Me	$2,882.57	7.25%
Student Loan - Me	$2,021.82	6.30%
Student Loan - Me	$2,882.26	2.88%
Student Loan - Me	$1,066.79	2.88%
Student Loan - Wife	$2,027.00	5.80%
Student Loan - Wife	$2,027.00	6.80%

The good (Cash):

Account	Balance
Checking - Bank 1	$                     7,044.72
Savings - Bank 1	$                     1,104.01
Savings - Bank 2	$                       451.68
Checking - Bank 2	$                     4,398.00
Total	$                   12,998.41

Income:

Source	Amount
Me - Paycheck	$                             1,982.91**
Wife- Paycheck	$                            ~ 1,100.00***

**$70,000 annual income and bonus

***$39,000 annual income

Questions:

1. Since my wife is starting her job on Monday, can we use her income when applying for a refinance? How do we do this?
2. What kind of costs can we expect from refinancing into a 15 year FHA loan? Fees as well as up front mortgage insurance, etc.? I'm looking for information on all costs...
3. Is refinancing a good option for me right now? Or should I pay off school loans, etc? (NOTE- I have a guaranteed bonus in August that will pay off my Citi card if it hasn't, which it most likely will, already be paid off)
4. Any concerns with qualifying (My middle score is 750 and her is 759)?
5. Other advice?

[JM-AM]

FHA is offering a refinance now (think is called streamlined) and I believe the rate is 3. something for 30 years and unsure of rate for 15 years.

All the closing cost are usually put into the loan and are much less then the first time around so YMMV on actual cost. You could also pay these closing cost upfront instead of putting into the loan if thats what is best for you.

You do not go through the same process for approvals and things of that nature. It is generally guaranteed as long as your scores qualify still (which yours does) and are still employed and can be verified for employment. 

[boomhower]

I thought you couldn't change the terms with a Streamline?  I thought all that you could change with it was the rate?

---

[JM-AM]

---

@boomhower wrote:

I thought you couldn't change the terms with a Streamline?  I thought all that you could change with it was the rate?

---

This depends on the lender in most cases so I will have to say YMMV. 

But even if they did not change to a 15 year and do lower rate just make your payments bi-weekly and it will save you many years of interest. The bi-weekly payment is your monthly payment divided into a payment of every 2 weeks (26 payments a year). Some lenders will offer you to make payments that way or you can just make the payments that way with-out commiting to anything in case you couldn't make the bi-weekly payment.