Arizona Mortgage Team

Arizona Mortgage Rates. Refinance FHA, VA and Jumbo Mortgage Loans.

  • Loan Programs
    • FHA Loans
      • FHA 203k Loan
      • FHA Streamline Refinance
      • FHA Kiddie Condo Loan
    • VA Loans
    • USDA Loans
    • HomePath Loans
    • Interest Only Mortgage Loans
    • Refinancing
    • Reverse Mortgages
      • Reverse Mortgage Quote
  • Insurance
    • Arizona Car Insurance
    • Arizona Homeowner Insurance
    • Arizona Life Insurance
    • Arizona Renters Insurance
  • Press
  • Blog

FHA 95% Cash Out Options

May 24, 2008

FHA recently added a 95% cash out option to their loan options, which allow borrowers to cash out limits of up to 95% of the home’s value and use the money for just about anything, from paying off medical bills to eliminating debts in collection, from buying a new truck to going on vacation. This has been one of the most popular loans that we have done over the last 6 months.

While homes must fall within a certain price range to be eligible for FHA loans, there is no limit on the income of the borrower. While conventional loan programs have, for the past several years, been somewhat more popular than FHA loans, the FHA 95% Cash Out loan has some borrowers thinking twice.

The FHA 95% Cash Out loan may be the best deal going for anybody who wants to cash out a significant amount of money. Why? Well, home equity lines of credit, otherwise known as HELOCs, are generally one percent higher than the prime rate. And while traditional fixed rate mortgages are one percent lower than the prime rate, it’s difficult to find one that will allow a 95% cash out deal. If you do find one, you can bet it’s going to cost you a lot of money. To add to the cost, the lender will most likely require the borrower pay PMI insurance any time the loan-to-value exceeds 80%.

FHA loans cost significantly less than other loan options that result in cash for the borrower, including personal loans or loans from a credit card. That’s because unlike lenders of conventional loans, most FHA lenders and brokers don’t increase the rate—or charge additional fees—for a 95% Cash Out loan. FHA also offers 30-year fixed rates to 95%, which means they cost the borrower less than adjustable, prime-based HELOCs. FHA programs also allow the borrower higher coupons, which means the borrower can sign off on a higher rate, and reduce or eliminate the loan’s closing costs. In addition to being low cost, borrowers using FHA 95% Cash Out loans may be eligible for certain tax deductions.

The FHA 95% Cash Out loan is also a great option for any borrower who needs cash, but doesn’t have the best of credit histories. Since FHA lenders look at each loan application on a case-by-case basis, lower credit scores may be acceptable if reasonable explanations are provided. It’s also possible for people with no credit history to apply for the FHA 95% Cash Out loan.

If you are in a situation that seems like you could lower your monthly payments by paying off some of your high interest debt (cars, credit cards, etc.) by using this FHA 95% program, make sure you run the numbers first. With so many options out there to choose from, make sure you ask a lot of questions!

Filed Under: Arizona Home Financing Options, FHA Loans, Refinancing in Arizona

Recent Items

  • How Does a VA Streamline Work?
  • Can you Use a Mortgage Assumption after a Divorce?
  • What are the Major USDA Streamline Guidelines?
  • How is the USDA Monthly Guarantee Fee Calculated?
  • How to Purchase USDA Foreclosed Homes?

Latest News

  • How Does a VA Streamline Work?
  • Can you Use a Mortgage Assumption after a Divorce?
  • What are the Major USDA Streamline Guidelines?
  • How is the USDA Monthly Guarantee Fee Calculated?
  • How to Purchase USDA Foreclosed Homes?

Search

IMPORTANT MORTGAGE DISCLOSURES:

When inquiring about a mortgage on this site, this is not a mortgage application. Upon the completion of your inquiry, we will work hard to match you with a lender who may assist you with a mortgage application and provide mortgage product eligibility requirements for your individual situation.

Any mortgage product that a lender may offer you will carry fees or costs including closing costs, origination points, and/or refinancing fees. In many instances, fees or costs can amount to several thousand dollars and can be due upon the origination of the mortgage credit product.

When applying for a mortgage credit product, lenders will commonly require you to provide a valid social security number and submit to a credit check . Consumers who do not have the minimum acceptable credit required by the lender are unlikely to be approved for mortgage refinancing.

Minimum credit ratings may vary according to lender and mortgage product. In the event that you do not qualify for a credit rating based on the required minimum credit rating, a lender may or may not introduce you to a credit counseling service or credit improvement company who may or may not be able to assist you with improving your credit for a fee.

Copyright © Mortgage.info is not a government agency or a lender. Not affiliated with HUD, FHA, VA, FNMA or GNMA. We work hard to match you with local lenders for the mortgage you inquire about. This is not an offer to lend and we are not affiliated with your current mortgage servicer.

Contact Us | Terms of Use | Privacy Policy

Buy Mortgage Leads

Mortgage.info

NMLS ID #1237615 | AZMB #0928735

8123 South Interport Blvd. Suite A, Englewood, CO 80112

CLICK TO SEE TODAY'S RATES

Contact Us