Modifying your rate on an existing FHA loan. Did you know you don't need to qualify for this loan modification?

Mortgage and Lending with Elmendorf Team | loanDepot NMLS 485091

No kidding. Regardless of the value of your home, you are allowed to streamline, or better yet, modify (the catchy phrase nowadays) your existing fha loan to the current rates of today. There is no qualifying, no appraisal needed, no documentation at all. Just you on a lower rate.  Many homeowners just think because they are upside-down they can't do anything.  Not true. 

Another widely missed option of the FHA loan is that you can use it to refinance your existing loan (or loans if you have a first and second) into a lower rate. This is pretty common for people that bought back in 2005 or 2006 and have a first and second. There are also people out there who have the combined LTV(loan to value) over 100%, ie. they are under water.  Note that FHA doesn't care about that. As long as the first mortgage is under the FHA required base loan to value (that one can't be underwater!) and the 2nd lien holder will subordinate, FHA won't care if you are "combined" under water. The key is getting the 2nd trust lender to subordinate.

TIP!!  If the amount of the 2nd is 50k or less and the home is in Virginia, the lender would allow an auto-subordination. Pretty cool huh?

So check into an FHA loan if you have issues with value or you have a current FHA loan at or above 5.5%.

Comments (7)

Sergio Rebollo Jr.
Real Estate TeamMates - Miami, FL

Rick.....Welcome to ActiveRain.  This is a great community to network with others as well a great place to learn from other's experiences and knowledge.  I've enjoyed it; I hope you enjoy it as well.

Sergio Rebollo Jr.
Exit Prime Realty
Coral Gables, FL  33146

Miami Short Sale Specialist - Profile

Feb 24, 2009 10:04 AM
Vicente A. Martinez
Prudential Douglas Elliman Licensed Real Estate Salesperson - Woodhaven, NY
Realtor, Brooklyn - Long Island - Queens Homes

Hi and welcome to active|rain.

There are thousands of tips, tools, and tricks of the trade here. Be sure to check them out. Best of luck and see you around.

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Feb 24, 2009 12:37 PM
Sandy Childs
Keller Williams Realty - Spartanburg, SC
Realtor - Spartanburg, SC

Congratulations on joining Active Rain. This is a great professional networking and referral site. Our Team is working here in the Spartanburg / Greenville areas of South Carolina. We would be thrilled for any referrals you might send our way - or any referrals that we could send to you. Hope you enjoy this site as much as I do.

Feb 24, 2009 09:39 PM
The Trumm Team Omaha Homes for Sale, Real Estate
Keller Williams Greater Omaha - Omaha, NE

Welcome to ActiveRain!

If you would like a few tips on getting the most out of ActiveRain, please visit my blog Welcome to Active Rain.  It has a few simple steps of what to do now that you have joined.

If you ever have any questions, just let me know.

Troy Trumm, Trumm Team, Omaha NE

Feb 25, 2009 01:44 AM
Jean Terry
Keller Williams Realty Spartanburg, S.C. - Spartanburg, SC

Hi and welcome to Active Rain, a great site to network, share, learn, and have fun. Good luck. And if you ever need an agent in the upstate of South Carolina, please call me

Feb 25, 2009 04:20 AM
Yvette Gardner
Keller Williams Realty, Spartanburg, SC - Spartanburg, SC

Welcome to the Active Rain community. This is a great site with lots of information.  Have fun with it and hope to see more of your blogs soon!  We have a team of three outstanding full time agents to assist your buyers and sellers in Spartanburg/Greenville, SC.  Let us know if we can ever help. Again, welcome to AR!!

Feb 25, 2009 09:44 AM
Morris Childs
PEP source - Spartanburg, SC

Welcome to Active Rain. It just gets easier after your first blog. Just write about what interests you.

Feb 25, 2009 11:11 AM