FHA ARMs in play

I know these days, ARM is the dreaded word, but with the FHA ARMs, there is a huge advantage that the conventional side does not offer. It is the streamline at no cost to the borrower. I bring this up, because FHA ARMs are in the low to mid 4’s, while the fix rates are in the low to mid 5’s. That is a huge savings, whether you are doing a refi or a purchase. It might even be a better benefit as a purchase if the lower rate lets you qualify to get into the home of your dreams! With the streamline, you can go from an ARM to a fix at any point after FHA has bought your loan. That is usually around 30-60 days from the time of settlement, depending on the county. The streamlines are only for rate and term, and when you see the fixed rates get to the level you want, that is when you lock in the rate for your streamline refi. The qualification process is easy, because there is no appraisal required and there is no income or asset verification. You need to make sure you are current with your mortgage payments, and your credit score is above a 620. As long as you have that, you should be fine. At the end of the ARM period, if the fixed rate is not there, you can do a streamline to another ARM or in some cases, the ARM adjustment make even lower your current payment. 

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