FHA Streamline

Refinance

Simplify Your Refinance, Lower Your Payments

The FHA Streamline Refinance is designed to make the refinancing process hassle-free and straightforward for those with an existing FHA loan. It allows homeowners to reduce their interest rate and monthly payments quickly and easily, often without the need for an appraisal or income verification.

Key Benefits

Reduced Monthly Payment

Quickly lower your monthly mortgage payment while securing a lower interest rate.

No Appraisal Required

In most cases, you can refinance without the need for a new appraisal of your home.

Simplified Process

Enjoy a streamlined approval process with less paperwork and faster closing times.

Refinance with Underwater Mortgage

You can still qualify even if you owe more on your home than it's currently worth.

FHA Streamline Refinance Information

The FHA Streamline Refinance is a way for homeowners with an existing FHA loan to reduce their interest rate and monthly payments. To better understand how this refinance option can benefit you, you can start by speaking to one of our seasoned experts.

Types of FHA Streamline Refinance

Credit Qualifying: Requires income documentation, credit check, and DTI calculation.
Non-Credit Qualifying: Doesn't require income verification, simplifying the approval process.

Requirements for FHA Streamline Refinancing

Must have an existing FHA-insured home loan
Must result in a net tangible benefit (e.g., lower monthly payment)
Must have made at least 6 payments on your current FHA mortgage
At least 210 days must have passed since the closing of your current mortgage
No late payments over 30 days in the last 6 months
No more than one late payment over 30 days in the last 12 months

Required Documents

Depending on the type of refinance, you may need to provide:

Most recent mortgage statement
Current FHA mortgage note
Final settlement statement or deed of trust
Homeowner's insurance information
Employment verification
Recent bank statements

Pros and Cons of FHA Streamline Refinance

Understanding the advantages and disadvantages of an FHA Streamline Refinance can help you make an informed decision.

Pros

Reduced monthly payment
No appraisal required in most cases
Can refinance with an underwater mortgage
No income or credit check required for non-credit qualifying refinance
Faster loan closing process

Cons

Closing costs apply (cannot be added to the new loan)
Limited cash back ($500 maximum)
Mortgage insurance still required
Only available for existing FHA loans

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FHA Streamline Refinance FAQs

Everything you need to know about FHA Streamline Refinance

Is income verification necessary for an FHA streamline refinance?

Income verification is not always necessary for an FHA Streamline Refinance. There are two types of FHA Streamline Refinance:

Non-Credit Qualifying: Income verification is typically not required. Lenders assume that if you're making timely payments on your current mortgage, you'll continue to do so with lower monthly payments.
Credit Qualifying: Income verification may be required. This type is necessary if you're removing a borrower from the mortgage or if the lender requires it based on their policies.

It's best to check with your lender about their specific requirements, as they can vary.

Will an FHA Streamline refinance impact my credit score?

The impact of an FHA Streamline Refinance on your credit score depends on the type of refinance:

Non-Credit Qualifying: This shouldn't significantly affect your credit score since the lender only considers fewer factors from your credit report.
Credit Qualifying: Your lender will review your credit score, credit history, and full report. This can decrease your credit score slightly, but only temporarily.

In general, any new loan application may cause a small, temporary dip in your credit score. However, if the refinance helps you make payments more easily, it could positively impact your credit score in the long run.

Do I need to refinance with my current mortgage lender?

No, you are not required to refinance with your current lender for an FHA Streamline Refinance. You can shop around and compare quotes from different lenders. However, keep in mind:

The FHA Streamline Refinance program is only available to those who already have an FHA mortgage loan.
While you can choose a new lender, your current lender might offer competitive rates or special deals for existing customers.
Compare not just rates, but also closing costs and overall terms when deciding on a lender.

It's always a good idea to get quotes from multiple lenders, including your current one, to ensure you're getting the best deal possible.

What are the closing costs on an FHA Streamline Refinance?

Closing costs for an FHA Streamline Refinance typically range from 2% to 6% of the loan amount. However, they can vary based on several factors:

You won't need to pay for a home appraisal, which can save you money.
Costs may include title search and insurance, credit report fees, and origination fees.
You'll need to pay an up-front mortgage insurance premium, which is typically 1.75% of the loan amount.
Some lenders may offer to include your closing costs in the loan, but this will increase your loan amount and monthly payments.

It's important to get a detailed breakdown of closing costs from your lender and factor these into your decision when considering a refinance. For personalized information about closing costs, speak with one of our mortgage experts.

Lower your monthly payments with an FHA Streamline Refinance.