mortgage news

Denver Refinance

Due to a substantial property value increase in the Denver Metro Area and still very low interest rates, homeowners Denver refinance may now reduce their monthly payment by dropping their interest rate and removing unnecessary mortgage insurance. The Denver real estate market has dramatically gone up in value since 2013 and surprisingly interest rates are still very low. In result, homeowners who currently pay monthly mortgage insurance can have it removed with as little as 5% equity. Even folks who purchase a home in the past year may now be eligible to save a few hundred dollars per month. Some possible loan options to consider below:

1) Refinance into a 30 year fixed loan w/NO mortgage insurance. In combination with a reduction of interest rate, homeowners can easily save a few hundred dollars per month.

2) Refinance into a 15 year fixed loan w/NO mortgage insurance. 15 year rates are traditionally even lower than 30 year loans which means homeowners may be surprised to find out that their mortgage payment will stay the same even if they do a 15 year loan.

3) Refinance into a conventional loan and get some cash back. A cash-out loan may be possible if a homeowner has 20% equity or more. Get cash at closing or consolidate debt directly through the loan.

4) For current CHFA homeowners, you may now be eligible to pay off your 2nd mortgage, remove mortgage insurance and lower your interest rate.

5) Homeowners who refinance into any of the above conventional loan options can skip 2 monthly mortgage payments on top of their monthly payment savings.

Although Colorado in general has seen a huge increase in property values, Denver, Arapahoe and Adams County has specifically has seen an amazing rebound from many years of a down real estate market. For homeowners who currently live in these areas, this is a terrific time to take advantage of better loan programs and interest rate.

CHFA Homeowners remove mortgage insurance

As most people are probably aware, property values in Colorado have risen dramatically since 2013. For homeowners who purchased their home utilizing a CHFA or FHA loan, now is an incredible time to refinance into a conventional loan. The reason this is beneficial is because you may now remove your mortgage insurance, pay off your 2nd mortgage and possibly reduce your interest rate as well. The goal is to save a few hundred dollars per month or even more.

In addition, you can skip 2 monthly mortgage payments and get up to $2,000 cash back as well. The combination of all these benefits is a very unique opportunity because it’s very rare to have low rates and high property values at the same time. This truly is an opportunity to take advantage of.

A conventional loan is not much different from a CHFA or an FHA loan except mortgage insurance can be removed with as little as 5% equity. Typically a high credit score(above 660 fico) will be important because unlike CHFA and/or FHA loans, conventional loans are driven by credit score and equity. If you purchased your home in the last couple of years, your mortgage insurance is for the life of the loan and can never be removed. Doing a conventional loan is the only way to remove it.

Conventional 30 year rates are currently hovering at or under 4% which means you can now remove mortgage insurance and probably lower your interest rate as well. This will dramatically lower your APR and save you tens of thousands of dollars in interest on top of a nice monthly savings. CHFA homeowners who are currently at or above 5% may also want to consider a 15 year loan because their payment will probably not increase by much due to a dramatic reduction in interest rate and the removal of the MI.

NEW Conventional 97% Financing

Backed by Fannie Mae and Freddie Mac, this program allows us to help homebuyers purchase a home with only a 3% down payment. This mortgage program is also referred to as the “My Community Mortgage” program. There are many benefits to this loan program including the following:

1) With only a 3% down payment, the My Community Mortgage is now comparable to an FHA loan which requires a 3.5% down payment.

2) Offers a lower monthly mortgage insurance premium compared to other conventional loan programs. This results in a lower monthly payment and more buying power.

3) Unlike FHA mortgage insurance, a homeowner can remove conventional mortgage insurance after they reach 20% equity.

4) Can be beneficial for homebuyers who lack a large down payment but have high credit scores.

How To Qualify?

Must have a minimum credit score of 620+
Must meet the maximum income restrictions. Some areas of Colorado do not have any income restrictions. Max income in the Denver Metro Area is $89,900 but many locations have no income limits at all. To check income limits for a specific location, Freddie Mac & Fannie Mar have designated a special map for homebuyers. Just plug in the property address that you’re interested in and see what the income limits are for that property.

Check Fannie Mae Home Ready Income Limits

Check Freddie Mac Home Possible Income Limits