CHARLOTTE-- Changes are on the way for some homeowners that could make it easier to refinance a mortgage.
Effective Monday, homeowners with FHA mortgages can take advantage of record low interest rates.
"They've been unable to refinance up until this point because there's been a significant increase in fees that FHA charges," said Chris Cope, president of Allen Tate Mortgage.
The Federal Housing Administration is slashing fees for streamlined refinancing – down to one-one hundredth of a percent of the base loan amount.
On a $200,000 mortgage, the fee would be $20 instead of $2,000.
"They're going to be able to drop their interest rate significantly," Cope said.
Mortgage planners say this makes refinancing an FHA mortgage doable.
"A lot of people couldn't take advantage of the loans because there really wasn't any benefit because of the higher premiums and people couldn't refinance," said Kenneth Land of Fairway Independent Mortgage.
The program only applies to people with FHA loans that closed on or before May 31, 2009. It could put cash back in homeowners' pockets and eventually back into the economy.
"For the average person, taking advantage of today's market will improve their cash flow," Land said.
FHA borrowers could drop their rate from 5 percent or more to 3.5 percent. Experts say it's a great way to reward people who've stayed current on their payments.
“We've got a lot of programs to help people who haven't made their payments but we haven't really generated, as a country, programs for people who have been making their payments," Cope said.
Homeowners who are underwater on their mortgage -- that is, the value of their home is less than the balance of their loan -- can qualify for the reduced fees.
"They've just been caught in a tough real estate market," Cope said.
Still, mortgage advisers say refinancing isn't for everyone -- including people that plan to move within a few years.
"A mortgage is a part of a plan," said Land.