One of the main qualifications of a FHA Secure loan as an FHA mortgage refinance option is that you must have had good mortgage payment history prior to an ARM interest rate reset. But what if the rate reset has not caused you to fall behind on your mortgage, just on everything else (credit cards, car payment, etc.)?
Many of you are familiar with the old adage…no matter what else…make sure you make the mortgage payment! This is good advice. A home is where we come for shelter. It is where we rest our head at night. It also is the largest financial investment most of us will make in our lives. Losing it because we cannot make the payments is a difficult thing to do.
Many individuals that have an ARM reset, may continue to have adequate mortgage payment history, but are behind on their car loan and credit cards. This situation may not be the perfect fit for the FHA Secure loan. But it may be a good candidate for what is called a 203(b) refinance or possibly another type of FHA mortgage refinance program.
FHA can help in so many different ways.
The great thing about FHA is that it is “common sense” type lending.
What does that mean?
Here is one example — once I worked with an employee for the post office. They delivered mail for the community and had been in an accident while on the job. The accident landed my borrower in the hospital and unable to work for a few of months. Their temporary job loss caused my borrower to fall behind on just about everything he had. His credit score was horrible and for him to do a conventional mortgage, with private mortgage insurance, while not impossible, was definitely more difficult. He had always made his payments on time before the accident and was now back at his job full time. He was able to provide me medical bills, workman’s comp, etc, etc ,etc to prove what his situation was. This loan made sense and was a perfect candidate for an FHA mortgage refinance type loan.
FHA is not worried about what your credit score is. The mortgage insurance on an FHA mortgage refinance loan is not sensitive to your credit score either. That cannot be said for traditional conventional financing. And if your loan “makes good sense”, it is a loan that can be done through FHA mortgage refinance program.
Is there an FHA mortgage refinance program loan that makes sense for your situation? Invest the time to find out.
