Quantcast

Did You Know?

FHA loans are one of the best options for young, first-time home buyers who have not had as much time to save for a large down payment or establish a high credit score.

FHALoan.com
Click to Start Your Refinance or Purchase Loan

The FHA Streamline Refinance Mortgage

The FHA Streamline Refinance Mortgage

For current FHA home loan borrowers looking to take advantage of falling interest rates, there is a specific refinance option that makes the process easy- the FHA Streamline Refinance.  

Streamlined Refinances for Current FHA Borrowers 

In a nutshell, the FHA Streamline Refinance allows mortgage holders to refinance their home loan without going through the process of second appraisal. Since this is a step that was completed with the first FHA mortgage, the FHA waives it for the refinance, making the process less time consuming AND less expensive. 

An additional benefit for FHA mortgage holders who have changed or lost jobs, is a “non-credit qualifying refinance,” which allows them to skip income and credit checks, that could result in them being disqualified. 

How to Qualify for an FHA Streamline Refinance  

While it all sounds great and easy, there are a few stipulations that FHA borrowers need to know of when considering to apply for a Streamline Refi.  

NO LATE PAYMENTS
All applicants must be on time with their monthly mortgage payments to be considered eligible for the Streamline Refi. While some exceptions are made by the FHA regards to late payments, individual lenders can place their own requirements (or “overlays”) that may keep you from qualifying for a refinance. 

LENGTH OF LOAN
Similar to your credit history, all borrowers must have held their loan and made regular payments for a minimum time period. Borrowers are only eligible for a Streamline Refinance if they have made a minimum of six monthly payments and have had their existing FHA mortgage for at least 210 days. Exceptions may be made in the case of lifechanging situations, such as divorce. 

NET TANGIBLE BENEFIT
Whether it is a lower interest rate, a shorter loan term, or both, there must be a measurable financial benefit to refinancing for a borrower to be approved for the Streamline Refinance. 
 
Things to Keep in Mind About the Streamline Refi

Closing costs still need to be paid, and the FHA does not allow financing them into the price of the loan. This does not include the Upfront Mortgage Insurance Premium, which can be financed. You will need lender approval to use gift funds  

If you are considering a cash-out refinance, the FHA Streamline Refi is not the best option. FHA guidelines limit no more than $500 cash-out with a Streamline Refinance to accommodate changes that might be made at closing. 

Falling interest rates are something that all FHA borrowers should keep an eye on to save on interest payments for the life of their loan. Talk to a loan officer if you feel the Streamline Refinance is the right option for you! 

------------------------------

RELATED VIDEOS:
Know What's On Your Credit Report
FHA Loans Have Credit Requirements
Help Is Available With Down Payment Grants
See Your Credit Scores From All 3 Bureaus
See Your Credit Scores From All 3 Bureaus
GET YOUR SCORES NOW!

More FHA Loan Articles

What Kind of Home Loan Works for Me?

Once you’ve decided that you’ll be purchasing a home, one of the first questions you need to ask yourself is what kind of mortgage you’ll be using to finance it. When it comes to shopping for a home loan, there are a number of options to consider.

Everything You Should Know About Appraising for a Refinance

Savvy homeowners make it a point to monitor interest rates so they can take advantage of a drop. Many choose to refinance their mortgages to capitalize on falling rates and lower their monthly payments and save on interest.

Down Payments for FHA Loans

One of the major hurdles that keeps families from purchasing a home is the need for a down payment.  The FHA’s goal is to offer more homebuying opportunities to low- and moderate-income Americans and set more easily achievable down payment requirements for borrowers. 

When Should I Get Approved for a Home Loan?

One of the first steps to take when you decide to buy a home is getting pre-approved for a mortgage. It is important to know what it means to get pre-approved for a home loan, and what the pre-approval letter does and doesn’t do for your home buying chances.

What Affects a Home Loan Applicant's Credit the Most?

A home loan is one of the most important investments you can make. Buying a home means owning property, and being a homeowner means there's potential to watch your investment grow in value over time.  But first, the lender has to make sure the borrower is a good credit risk.


-- Find More Articles in the FHALoan Library --

FHALoan.com is not a government agency. We do not offer or have any affiliation with loan modification, foreclosure prevention, payday loan, or short term loan services. Neither FHALoan.com nor its advertisers charge a fee or require anything other than a submission of qualifying information for comparison shopping ads. We do not ask users to surrender or transfer title. We do not ask users to bypass their lender. We encourage users to contact their lawyers, credit counselors, lenders, and housing counselors.

SecureRights Advertiser Contact Information