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FHA Streamline Qualifications

I tried to get approved for an FHA streamline loan, the only drawback is that they require my monthly payment be reduced by 5% than it is currently, is there a way around that? Not so much concerned about reduction in payment as I am trying to secure a 30 year fixed FHA loan. Original FHA loan was closed 9/2009, mortgage was 416k, it is currently 396k, my monthly mortgage is $2075, mortgage with taxes and insurance and PMI is $2758, currently on the third year of a 5 year ARM @ 4.375%...Thanks
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June 14 2012 - Los Angeles
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Is your value just not there? If i is I can go 95% conventional and maybe look at an LPMI loan? There will be no mortgage insurance and your payment will be a LOT less.
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June 17 2012
Unfortunately, while the loan is still in the Fixed period, then the payment is still required to have a reduction of 5% (based on Principle/Interest and Mortgage Insurance Premium).  Have you looked into the possibility of refinancing into another 5/1 ARM?  If the numbers work, then at least you'll be locked into another 5 years with a lower interest rate.

If the loan was endorsed by FHA prior to May 31st 2009, then it may be possible to qualify with the new guidelines for those loans.

The issue with qualifying today is the increased monthly mortgage insurance and the higher upfront mortgage insurance.  Sometimes, you have to have a buffer of 1.375% in the interest rate in order to qualify.

Also, is your place underwater?  I've seen a few people able to refinance from their FHA loans to a Conventional loan program.  It's something worth investigating.
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June 14 2012
since the term of the loan is still 30 year and you are still in the fixed period of your loan (3rd year) then as long as you are saving 5% from your current payment you can qualify for the streamline refinance.
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June 14 2012
 
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