March 18, 2015
If you have never applied for an FHA appraisal-required refinance loan before, you probably have plenty of questions about program basics. How long can the new loan be? Can I re-use a previous appraisal? What is the maximum loan amount?
The answers to these questions can be found in HUD 4155.1 Chapter Three Section A, which informs us that the longest loan term for any refinance with an appraisal is 30 years. Chapter Three also adds:
“The maximum term of a streamline refinance without an appraisal is limited to the lesser of
• the remaining term of the existing mortgage, plus 12 years, or
• 30 years.”
The appraisal question is also answered here, with FHA loan rules stating that FHA appraisals (for existing properties) are good for six months, but that even a valid appraisal cannot be re-used if the loan it was for has closed.
Specifically the FHA rulebook states:
“FHA appraisals on existing properties are valid for six months. However,appraisals cannot be reused
• during the six month validity period once the mortgage for which the appraisal was ordered has closed, or
• for a subsequent refinance, even if six months have not passed.”
And just to eliminate any ambiguity here, Chapter Three adds, “A new appraisal is required for each refinance transaction requiring an appraisal.”
When it comes to maximum loan amounts, the type of loan determines the maximum Loan-To-Value Ratio. Check with your lender to discuss maximum loan amounts based on the type of FHA refinance loan you want to apply for.
Do you have questions about FHA loans or refinance loans? Ask us in the comments section. All questions and comments are held for moderation before being posted on the website.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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