PHFA offers refinancing programs to help low-income homeowners in Pennsylvania reduce their mortgage payments, access cash for home improvements, and improve financial stability. Key options include FHA, VA, and conventional loans with flexible terms and cash-out options. Here's a quick breakdown:
- Keystone Flex Loan Program: Offers refinancing for conventional, FHA, and VA loans with up to 97.75% LTV and cash-out options up to $10,000.
- FHA Streamline Refinance: Simplifies refinancing for FHA loans with no appraisal and up to 97.75% LTV.
- VA IRRRL: Designed for veterans, offering 100% LTV with no cash-out.
- HFA Preferred™ (Lo MI): Suitable for low down payments, limited to single-unit properties.
Quick Comparison:
| Program | Max LTV | Cash-Out Option | Eligible Properties | Notes |
|---|---|---|---|---|
| Keystone Flex | Varies | Up to $10,000 | Single and 2-unit | Flexible terms for all loan types |
| FHA Streamline | 97.75% | No | Single and 2-unit | Streamlined for FHA loans only |
| VA IRRRL | 100% | No | Single and 2-unit | For VA loans, no cash-out |
| HFA Preferred™ (Lo MI) | 97% | No | Single-unit only | Low down payment, income limits |
To apply, contact a PHFA-approved lender, gather required documents, and complete homebuyer education if needed. For assistance, call 1.855.U.Are.Home (827.3466).
PHFA Keystone Flex Refinance
The PHFA Keystone Flex Refinance program provides Pennsylvania homeowners with a 30-year fixed-rate mortgage option, offering favorable terms for refinancing.
Available Loan Types
Here’s a breakdown of the loan types and their cash-out limitations:
| Loan Type | Maximum LTV | Cash-Out Limits |
|---|---|---|
| Conventional | 97% | Lesser of $2,000 or 2% of the loan |
| FHA | 97.75% | Maximum $500 cash-out |
| VA | 100% | No cash-out option available |
Each loan type features a fully amortized 30-year fixed-rate structure.
Who Can Apply
To be eligible for the PHFA Keystone Flex Refinance program, applicants must meet these requirements:
- Use the property as their primary residence.
- Have a minimum FICO credit score of 660.
- Fall within the program's income and loan amount limits.
- Show the ability to manage monthly mortgage payments.
This program is available for single-family homes and two-unit properties, making it a viable option for a range of homeowners across Pennsylvania.
Cash-Out Options
The program also includes cash-out options, allowing homeowners to access their home equity:
- Standard Cash-Out: Borrow up to $10,000 across all eligible loan types.
- Limited Cash-Out:
- FHA loans: Maximum of $500.
- Conventional loans: Lesser of $2,000 or 2% of the loan amount.
- VA loans: No limited cash-out option available.
These features provide a way to access funds for projects like home improvements or debt consolidation while maintaining manageable loan terms. The program is designed to balance flexibility with financial stability.
How to Apply
Get started with your refinancing process by following these steps:
Application Steps
Here's how to apply through an approved PHFA lender:
-
Contact an Approved PHFA Lender
Reach out to a PHFA-approved lender who will handle your application and closing process. -
Complete Homebuyer Education
If your FICO score is below 680, you'll need to complete a homebuyer education course. This helps you understand the refinancing process and your obligations. -
Work with a Housing Counselor
For extra support, you can consult a PHFA-approved housing counselor for personalized advice.
Once these steps are done, gather the necessary paperwork to keep your application process smooth.
Required Documents
Have these documents ready to avoid delays:
| Document Type | Purpose | Notes |
|---|---|---|
| Mortgage History | Shows proof of timely payments | Required for FHA Streamline Refinance |
| Funds Verification | Confirms funds for closing costs | Use bank statements or similar proof |
Be prepared to cover standard fees such as credit report charges, property appraisal costs, and title search and insurance fees.
Now, let's look at how to keep your application moving efficiently.
Processing Time
PHFA doesn't provide a set timeline for processing. Factors like lender response times, document completion, and appraisal scheduling can impact how long it takes. To avoid delays:
- Submit all required documents as soon as possible
- Respond quickly to requests for additional information
- Maintain regular communication with your lender
Once your loan closes, PHFA immediately purchases it, and you'll make payments directly to PHFA for the life of the loan.
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Program Comparison
Here's a breakdown of PHFA refinancing options to help homeowners choose the right program for their needs.
Program Features
| Program Feature | HFA Preferred™ (Lo MI) | FHA Streamline | VA IRRRL | Keystone Flex |
|---|---|---|---|---|
| Max LTV | 97% | 97.75% | 100% | Varies by type |
| Cash-Out Option | No | No | No | Up to $10,000 |
| Property Types | Single-unit only | 1-2 units | 1-2 units | 1-2 units |
| Down Payment | $1,000 minimum | Not required | Not required | Varies by type |
Advantages and Limitations
- HFA Preferred™ (Lo MI): This program offers lower mortgage insurance costs and the perks of a conventional loan. However, it comes with income restrictions, is limited to single-unit properties, and requires at least $1,000 as a contribution.
- FHA Streamline: Known for its simple documentation process and no need for a new appraisal. On the downside, it’s only available for existing FHA loans, doesn’t allow cash-back, and requires addressing any subordinate loans.
- VA IRRRL: Provides full financing with no mortgage insurance. However, it’s exclusive to current VA loan holders and doesn’t allow for cash-back options.
- Keystone Flex: Offers flexible financing options and allows cash-out refinancing up to $10,000. On the flip side, it has varying LTV limits and stricter qualification criteria.
Finding Your Best Option
When deciding, consider these key factors:
- Current Loan Type: Programs are tailored to specific loan types. For example, FHA loans align with FHA Streamline, while VA loans fit VA IRRRL.
-
Financial Goals:
- If lowering monthly payments is your goal, FHA Streamline or VA IRRRL might be the way to go.
- Need cash? Keystone Flex is your best bet.
- Want to reduce mortgage insurance costs? HFA Preferred™ (Lo MI) could be the right choice.
-
Property Type:
- For single-unit properties, all programs are available.
- For two-unit properties, consider FHA Streamline, VA IRRRL, or Keystone Flex.
For personalized guidance, consult a PHFA-approved lender to determine which program aligns best with your situation.
Help and Resources
Looking for more guidance or local support? Here are some helpful resources to consider.
Free PHFA Counseling
The Pennsylvania Housing Finance Agency (PHFA) provides free counseling services to help with mortgage readiness, credit repair, budget planning, and fair housing education. If your FICO score is below 680, you'll need to complete an in-person counseling course before your loan can close.
For assistance, call PHFA's Customer Solutions Center at 1.855.U.Are.Home (827.3466). If you have trouble accessing counseling agencies, reach out to Terri L. Redmond at 717.780.3907.
Central PA Housing Help
Central Pennsylvania offers a range of local organizations to assist with refinancing and other housing needs. For example, Central Pennsylvania Community Action (CPCA) supports Centre and Clearfield counties by offering affordable housing programs, utility assistance, and home rehabilitation services for low-income families.
PHFA also provides Financial Education and Coaching Programs, which include local workshops, one-on-one sessions, and free online personal finance seminars. These resources can be a great complement to the refinancing options discussed earlier.
Central PA Realty
Central PA Realty specializes in helping homeowners across key counties in the region.
"Your situation is unique - let's talk. Reach out today, and we'll listen to your needs, answer your questions, and explore the best options for you - whether you're buying, selling, or looking for a fast cash offer."
Their services include free real estate consultations, advice on quick cash offers or traditional market listings, help with home repairs and preparation, and support for homeowners who may not qualify for refinancing. If you need tailored assistance, they’re ready to help.
Summary
Main Points
PHFA refinancing programs provide options for low-income homeowners in Central Pennsylvania to lower their monthly mortgage payments and improve their overall financial outlook.
Key Points
-
Available Programs and Benefits
- The Keystone Flex Loan Program offers refinancing options through Conventional, FHA, or VA financing.
- FHA Streamline Refinance helps FHA loan holders reduce their monthly payments by refinancing their current mortgage.
- The VA Interest Rate Reduction Refinancing Loan (IRRRL) allows eligible veterans to refinance their VA-guaranteed loans at a lower interest rate.
-
Program Features
- HFA Preferred™ (Lo MI) provides better terms for borrowers with smaller down payments.
- Keystone Flex includes cash-out refinancing options for homeowners.
- Borrowers with FICO scores under 680 must complete homebuyer counseling.
Next Steps
Reach out to a PHFA-approved homebuyer counselor, connect with a participating lender, or call PHFA's Customer Solutions Center at 1.855.U.Are.Home (827.3466) for assistance.
PHFA services your mortgage for life, offering continued support whether you aim to lower payments, switch loan types, or access home equity.
