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FHA loan refinancing with FHA streamline worth it ???

with a balance of 428K. It is single family property located in VA 22066. My loan is a 30 yr fixed FHA loan at 5.25% interest. I am looking to continue under the FHA streamline programs to lower my interest rate. My current FICO score is 785. I am currently paying $3250 (inclusive of P&I, escrows, home insurance, and the MIP). The quotes I have received are with FHA 4.25% with a monthly payment of $3060 again (inclusive of P&I, escrows, home insurance, and the MIP). With a difference of $190 in monthly payments and a closing cost of $6350. Even if I consider the escrow/MIP refunds (may be close to $3000), I am wondering if it is worth getting it refinanced. It will take about 16 months just to recoup the new closing costs.Also, isnt the appraisal waived in FHA streamlined refi if I pay the closing costs? by maryma_168 from Bozeman, Montana. Aug 2nd 2011 Reply


J Martin (jmarr91)
#10 ranked lender in Georgia - 25 contributions

If you're planning on staying in the home for a long period of time, it's worth refinancing. Are you refinancing with the same lender? Yes, the appraisal fee is waived in a FHA streamline refi. Take a very CLOSE look at your closing costs. How long have you been in the home?

Aug 2nd 2011
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John Burke (jburke)
#29 ranked lender in Texas - 227 contributions

Hi Maryma_168,Are you paying any points for the 4.25% rate? The other thing to consider here is the possibility that you'll skip a mortgage payment which effectively reduces your closing costs by $3,250.00 and even if you don't you'll still save $65,360 in interest over the life of the loan.Here is how I came up with that number.360 months minus the 16 months it will take you to recoup the closing costs = 344 months X $190 per month in savings = $65,360.00.http://www.fhamortgagesdoneright.com

Aug 2nd 2011
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Craig S. Spaulding (togabroker2@yahoo.com)
#55 ranked lender in New York - 18 contributions

Good Afternoon and Thank You for your question.There are several factors to consider when refinancing. Cost- Benefit- Goals of the loan etc. Depending on your lender, you can usually have the 1st couple of mortgage payments waived and that can weigh into your savings. Also- your up-front MIP and your monthly mortgage insurance premiums are typically 100% tax deductible so that money should be coming back to you. By my calculations it seems that an FHA streamline could be a good move for you. You may be eligible for an appraisal waiver- you would have to have your lender or whomever you chose to handle this transaction, submit your file and see. Best of luck to you and please do not hesitate to contact me if I can be of any further assistance.

Aug 2nd 2011
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