Are there any downsides to a FHA Steamline mortgage loan?

There aren't any downsides to a FHA Streamline refinance. Quite the opposite. It is a reduced documentation refinance and in some cases the lender will not require an appraisal. However, I doubt the savings being quoted to you are correct. I would ask to see a Good Faith Estimate. The MI on this loan will increase enough to negate a 1 % reduction in rate, and rates arent much lower than six months ago. Unless you have a much higher rate for some reason. I am a PA lender. FHA for 20 years. I would be happy to review what you are being quoted. Mike Clancy Allied Home Mortgage 630 Freedom Business Center, King of Prussia, PA 610 768 7788

It seems too good to be true from what you have mentioned. One big change with FHA loans is that upfront annual premiums have increased as of April 18th, 2011. Therefore, your monthly mortgage insurance is going to be doubled to what your paying right now.

At first blush, Saving $375 per month with no cost sounds great, but something is missing from the details. In order to save that much on a $250,000 loan, your interest rate would need to drop over 2%, which isn't likely on a 6 month old loan. Something is being left out of the equation. I don't lend in PA, but am an FHA lender. Call me at 888-889-9950 and I would be happy to go over the details with you and make sure you have everything necessary to make a good decision.

Something doesn't sound right.. your PMI is at .9 ?? Saving $375.. are you sure the payment quoted was PITI with PMI or maybe just PI?? You should look a bit deeper into this.. As far as us guys profiting from your refinance... simply put, the lender pays the broker to bring them a loan they otherwise would not get, and your broker is taking part of that payment and giving it back to you to help pay the costs.. this is very common in refinance transactions. WilliamAcres.com

The montly MI is now 1.15% so that will go up - on a $250,000 loan it will go to approx $240.00 per month from $187.50 -not quite double, but a pretty big chunk!Rates 6 monts ago on an FHA were 4.875-5% so on a streamline the lender needs to make enough money on the rate to pay all of your closing costs and make some profit. The lender would need to quote 4.5-4.625% in order to cover all of your costs and make a profit.I am pretty sure your lender has a few buttons out of whack on his mortgage calculator!

Sounds very suspect to me. As some of the others mentioned the monthly mortgage insurance has just gone up. I am a local PA lender and I would be glad to take a look at everything for you. 866-823-4330