Homeowners invest hard earned money into their homes year after year. Sometimes, homeowners use that investment for themselves and find it a great solution to a financial problem. Refinancing your mortgage with an FHA loan can be a great way to put that home equity to use.

Many homeowners use their homes equity to pay off debts, college tuition, home improvements, or anything else you will need help with financially. Remember though that an FHA refinance is only available to homeowners live in the home as a primary residence. They cannot be used for second, investment, or vacation properties.

FHA has a few different choices for homeowners who are thinking about an FHA mortgage refinancing:

FHA Cash Out Mortgage Refinance
This option is especially good for homeowners who have seen the value of their homes increase since they purchased it. Cash out mortgage refinance will allow a homeowner to refinance with a bigger loan than they have now, and pocket the difference. The home equity you have built up over the years is put to use in getting you a larger loan than you already have, and a large amount of cash.

While not all the time, it is better to get a cash out refinance after you have a decent amount of equity built up in your home. Typically, homeowners should have more than 20% equity in their home to consider a cash out refinance to ease financial problems. Another good thing is that this is usually a much better interest rate than a personal loan would be at.

Streamlined FHA Mortgage Refinancing Options
This is considered a streamlined option because it allows a homeowner to quickly reduce interest rates on their mortgage, often without an appraisal. This FHA streamline refinance option also reduces the amount of paperwork involved on the lenders side. This saves both time and money.

Homeowners who want to use the quick option need to already have an FHA mortgage which is in good standing. Also, it is necessary that the refinance does reduce your interest rates. While this option does not allow you to get cash back from your homes equity, it does quickly reduce your payments and interest rate. This is a great option for homeowners looking to minimize expenses and save as much money as possible.

-M Petrone

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