Refinance my FHA loan

[Larry Perez]

Hello all,

I purchased a house 4 years ago for 145K with a 30yr @4.25% FHA loan (5% down). After living in the house for 1yr I decided to rent it out (does not cash flow well).

 I now owe 100K on the loan and was hoping to refinance and put 25k down to increase cash flow. My lender says it is not a good idea because interest rates on an investment refinance are too high.

Should I listen to my lender?

[Upen Patel]

@Larry Perez The other thing you can do is a FHA Streamline refi to bring down the loan interest rate. You might be able to recast it to a 30 yr loan. This will help bring your monthly down.

[Jamie Ware]

@Upen Patel is 100% correct. This would be your best option especially with the extra funds to paydown the principal ($25k).