What Determines Your FHA % Rate?

[Anonymous]

FHA 30yr fixed @ 6%

Loan amount - $541,000

State - VA

Closing 4/11/2008

Message Edited by marsupial on 04-03-2008 10:20 AM

[Junejer]

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@Anonymous wrote:

Excuseme, would you please tell me what is FHA ? can I refinance my motgage with FHA?

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Bump.

Future SIL in same boat.

[Anonymous]

jessy

FHA is a government run program that insures mortgages for FHA approved lenders.  It's existence allows lenders to make loans to people that otherwise might not qualify for conventional mortgage financing.  You as a borrower pay "mortgage insurance" as part of of your monthly payment for 5 years and/or until the house has more than 20% equity based on purchase price.  So essentially all of us who have FHA mortgages contribute to a pool of dollars that the FHA uses as insurance to pay a lender that has a borrower default on their loan.

You can get all in the information at FHA's web site, but recommend you talk with an experience mortgage broker that handles FHA loans so you can have a Q&A dialogue with him/her.

http://www.hud.gov/offices/hsg/fhahistory.cfm

[Anonymous]

Thank you guys!!!!

[Anonymous]

Wells Fargo San Antonio 133000 5.65% Locked on Thursday Closing on 04/28 Also going through the Texas First Time Home Buyer program, so that may have something to do with it, since Wells Fargo website says 6% for their current FHA rate (its been there for the last 2 and a half weeks.

[ShanetheMortgageMan]

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TexCredit wrote:

Anyone know what factors determine what interest rate you get with an FHA loan?  Since the program is not score driven, it is up to the lender originating the loan and it's up to us as consumers to find the lender with the best rate?   Does the content of your credit profile somewhat dictate your rate (i.e. number of baddies, old foreclosure or BK, etc)?

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Not all lenders have the same adjustments, so keep that in mind.  But items such as state the property is located in, the FICO score (at least now it has some bearing), and the loan amount will shape one's FHA interest rate.  Some lenders just inheritantly have higher or lower interest rates than others.

[ShanetheMortgageMan]

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@Junejer wrote:

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@Anonymous wrote:

Excuseme, would you please tell me what is FHA ? can I refinance my motgage with FHA?

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Future SIL in same boat.

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Yes you can, FHA permits refinances of both refinancing what's owed on the home (called a "rate & term" refinance) and also to take cash out (simply called "cash out").  Cash out can go up to 95% of the homes appraised value, and rate/term refinances can go up to 98% of the home's value (varies ever-so-slightly depending on loan amount and state you are in).