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Current mortgage is a FHA 30 year fixed rate 6.75% rate endorsed 09/2008. Two borrowers on initial mortgage.
Started the streamline process in Feb. Goal was to find a way to streamline refi and remove a co-borrower. Turned out to be credit qualifying on one borrower with a low 700 credit score. The process started just before the announcement of the FHA MIP reduction for FHA loans originated prior to May 2009. I actually knew about this reduction the day it was announced and emailed my mortgage broker about it. She seemed to somewhat assure me that it would be no big deal if we just let the process ride out to see if it was approved. Well the mortgage was conditionally approved for an FHA streamline without appraisal (30 year fixed @ 3.995%). The current conditional approval is the higher MIP (of course).
A couple important notes from approval letter;
Quote:
This conditional Approval will expire on May 01, 2012 . This is not your lock expiration. This loan must close and disburse no later than your lock expiration or conditional approval expiration whichever is earlier or this conditional approval is null and void. If this conditional approval is extended it shall be extended at a different rate and different fee.
Quote:
UFMIP / Funding fee to be financed is {1.0} % rounded down to the nearest whole dollar. Remainder to be paid in cash. Annual MIP factor is {1.10} %. Due to UFMIP refund amount, this loan must disburse by {4-30-2012} or loan must be re-underwritten.
I really am grateful we were granted the opportunity to do a streamline when I first started researching the process it seemed sort of hopeless (given the circumstances of removing a co-borrower). Again, I don't want to seem ungrateful, but I don't want to kick myself for paying so much more in upfront and annual MIP if I can just simply wait. But of course, if I shouldn't look a gift horse in the mouth and simply take what I'm offered now, then I will.
How big of a deal (given information I provided) is it to just wait until after 6/12/2012 and either start process over or see if I can extend the conditional approval (hopefully an extension would grant the lower MIP)?
Current mortgage is a FHA 30 year fixed rate 6.75% rate endorsed 09/2008. Two borrowers on initial mortgage.
Started the streamline process in Feb. Goal was to find a way to streamline refi and remove a co-borrower. Turned out to be credit qualifying on one borrower with a low 700 credit score. The process started just before the announcement of the FHA MIP reduction for FHA loans originated prior to May 2009. I actually knew about this reduction the day it was announced and emailed my mortgage broker about it. She seemed to somewhat assure me that it would be no big deal if we just let the process ride out to see if it was approved. Well the mortgage was conditionally approved for an FHA streamline without appraisal (30 year fixed @ 3.995%). The current conditional approval is the higher MIP (of course).
A couple important notes from approval letter;
I really am grateful we were granted the opportunity to do a streamline when I first started researching the process it seemed sort of hopeless (given the circumstances of removing a co-borrower). Again, I don't want to seem ungrateful, but I don't want to kick myself for paying so much more in upfront and annual MIP if I can just simply wait. But of course, if I shouldn't look a gift horse in the mouth and simply take what I'm offered now, then I will.
How big of a deal (given information I provided) is it to just wait until after 6/12/2012 and either start process over or see if I can extend the conditional approval (hopefully an extension would grant the lower MIP)?
Two things:
First off there is NOTHING "GIFT" about a FHA Mortgage. Either you qualify or you don't and nobody pulled any strings for you to qualify. You fit the criteria and, unless something was done illegal, you will continue to qualify.
Secondly, you would save, possibly, thousands in closing UFMIP AND Tens of Thousands in Annual MIP. Why wouldn't you wait?
First off there is NOTHING "GIFT" about a FHA Mortgage. Either you qualify or you don't and nobody pulled any strings for you to qualify. You fit the criteria and, unless something was done illegal, you will continue to qualify.
Secondly, you would save, possibly, thousands in closing UFMIP AND Tens of Thousands in Annual MIP. Why wouldn't you wait?
Nope, no strings pulled. Just removed a co-borrower and had to see if we could qualify with just one individual instead of two individuals like we did when the mortgage originated. It just seems like a over a month ago when I found out about the decrease in MIP, my broker was trying to somewhat talk me out of waiting by saying things like "by that time you don't know what the rates will be, I have heard they will be going up". Then she went on reading me some article about rates spiking soon. It was kind of discouraging. But rates would have to spike an awful lot (at least an entire percent) to make it not worth waiting for me to go for the lower MIP option. I don't mind starting the whole process over again. I just don't know if two credit pulls in a short time would discourage them (even though they are the ones that pulled the credit report both times) or if there was a way to extend it like was stated in the approval letter?
Nope, no strings pulled. Just removed a co-borrower and had to see if we could qualify with just one individual instead of two individuals like we did when the mortgage originated. It just seems like a over a month ago when I found out about the decrease in MIP, my broker was trying to somewhat talk me out of waiting by saying things like "by that time you don't know what the rates will be, I have heard they will be going up". Then she went on reading me some article about rates spiking soon. It was kind of discouraging. But rates would have to spike an awful lot (at least an entire percent) to make it not worth waiting for me to go for the lower MIP option. I don't mind starting the whole process over again. I just don't know if two credit pulls in a short time would discourage them (even though they are the ones that pulled the credit report both times) or if there was a way to extend it like was stated in the approval letter?
Anyway, thanks for the encouragement.
Remember when the rates fell into the high 4s back in 2009 and it was record shattering, REFINANCE NOW BEFORE IT'S TOO LATE!? Remember when it dipped into the low 4s back in 2010 REFINANCE NOW BEFORE IT'S TOO LATE!? Remember when it dipped into the high 3s back in 2011 REFINANCE NOW BEFORE IT'S TOO LATE!? Remember when it dipped into the mid 3s in late 2011/early 2012 REFINANCE NOW BEFORE IT'S TOO LATE!?
I'd pass on your broker as she is obviously NOT looking out for your best interest and only hers (Commission check).
While rates may rise in the future, I doubt it will by a huge amount and surely** not nearly the amount that would justify paying the extra UFMIP and MIP.
**: Judging by Mr. Fed Chairman, I would expect rates to stay the same -/+ for the rest of 2012 into 2013 unless something huge happens with America (nuked, war, or 4yrs more Obama ).
Remember when the rates fell into the high 4s back in 2009 and it was record shattering, REFINANCE NOW BEFORE IT'S TOO LATE!? Remember when it dipped into the low 4s back in 2010 REFINANCE NOW BEFORE IT'S TOO LATE!? Remember when it dipped into the high 3s back in 2011 REFINANCE NOW BEFORE IT'S TOO LATE!? Remember when it dipped into the mid 3s in late 2011/early 2012 REFINANCE NOW BEFORE IT'S TOO LATE!?
I'd pass on your broker as she is obviously NOT looking out for your best interest and only hers (Commission check).
While rates may rise in the future, I doubt it will by a huge amount and surely** not nearly the amount that would justify paying the extra UFMIP and MIP.
**: Judging by Mr. Fed Chairman, I would expect rates to stay the same -/+ for the rest of 2012 into 2013 unless something huge happens with America (nuked, war, or 4yrs more Obama ).
You are right. Also I would absolutely be kicking myself for years for taking her advice and jumping the gun. If she can't understand that and still tries to push me into not waiting then I'll certainly walk.
Thanks again for showing me I'm making sense thinking about waiting.
Just wanted to follow up on this. I waited and restarted the process again in June. Took nearly 3 times as long with a combination of even lower rates over the summer and a glut of "grandfathered MIP" eligible refinances being done (I'm suspecting this was why?). The waiting was going on forever. It even got to a point where my mortgage person called and asked to run credit for the bad credit co-borrower on our current loan and then I almost couldn't get a hold of her for two weeks. But then out of nowhere she said the loan was approved. Same MIP rate as I had from 2008, $8.50 upfront MIP, and better yet a lower interest rate. Now 3.626% where previous approval was for 3.995%. Even though it's been a long summer wondering if it was ever going to be done, as of Friday the closing papers were officially signed. Was well worth the pain of waiting.
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Remember when the rates fell into the high 4s back in 2009 and it was record shattering, REFINANCE NOW BEFORE IT'S TOO LATE!? Remember when it dipped into the low 4s back in 2010 REFINANCE NOW BEFORE IT'S TOO LATE!? Remember when it dipped into the high 3s back in 2011 REFINANCE NOW BEFORE IT'S TOO LATE!? Remember when it dipped into the mid 3s in late 2011/early 2012 REFINANCE NOW BEFORE IT'S TOO LATE!?
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