What Happens When The Homeowner Makes Too Much Income

Date: October 23, 2012

One of the drawbacks of the USDA-To-USDA Rural Development Refinance program is that there are income restrictions that may preclude a homeowner, who has an existing USDA Loan from refinancing into a new USDA Loan, due to the current household income exceeding the county specific household limits. When this occurs and the homeowner has equity in their house, there still may be options to refinance their loan into a new non-USDA Loan with having as little as a zero equity stake in their property.

Loan programs to assist homeowners refinance, provided the house value is supported with an appraisal report, are as follows:

VA Loan – available to homeowner’s who are current and former military. The VA Loan will allow the homeowner to refinance at 100% of the outstanding loan amount provided the house appraises for more than the current loan amount
FHA Refinance – requires 2.25% equity stake. Available to all homeowners. Current credit score requirements are 640
Conventional Refinance with and without a monthly mortgage insurance premium – requires a minimum 5% equity stake. Based on the equity stake credit scores can be as low as 680

To learn more about your financing options please call (866) 351-3229.


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