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Opinion, commentary and analysis on everything that makes the U.S. housing economy tick -- not to mention the ghosts in the machine, too. Written by HW's team of editors and reporters each business day.

Refinancing away from the government, with an FHA blessing

January 15, 2013

My esteemed colleague Kerry Curry finds lending refinancing conditions to be overly exclusive.

What's worse, the FHA is making things more expensive for homeowners. So Curry not only can't get out from under the FHA, but is forced to pay higher mortgage-insurance premiums, and for longer.

To her, it feels like an insult to injury.

The interesting thing behind all this, is that I recently refinanced my mortgage away from the FHA, and talked to Commissioner and Assistant Secretary for Housing, Carol Galante about it before doing so.

While at the HousingWire REperform conference, I explained that I was, like Curry, a homeowner of decent credit and employment. It would be a shame to lose my business, I told Galante.

She agreed, but then said something that still lives with me. "The role of FHA is to enable homeowners. FHA helped you get your home, made it happen," Galante said. "If you find you can move on, then I'm pleased you have that opportunity."

Galante then discussed how new measures, the very same issues Curry is facing, are a necessary step to promoting a move away from the FHA and to a competitor. Of course, my new loan is destined to return to the government, and placed with Fannie Mae or Freddie Mac, so there is still much work to do.

Curry states the changes are at the expense of some homeowners.

This is true, but it's by no means deceptive; the FHA did not seek to get a bunch of people on their books and then decide to nickel-and-dime them to death — Galante is confident the new measures aid market correction. Further, the changes also spurred me to go find a better deal with another lender.

It's just a shame it's only going to go right back there, one way or another. So the personal stories offered by HousingWire editor's show that the mortgage market is far from healed regardless of a housing recovery. Still, it was nice to get that blessing from Galante.

In a perfect lending world, everyone would win.

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