FHA Streamline Refinances are still a phenomenal deal if you have an existing FHA loan with rates above 5.5%!
FHA Streamline loans are designed to help existing FHA homeowners lower your monthly mortgage payment by reducing your interest rate and closing costs. How can you qualify for an FHA Streamline loan?
As a starter, you need an existing FHA mortgage loan! If you don’t have an FHA loan, talk to me about refinancing your current loan and what options are available.
FHA Streamline requirements include:
- Must be current on your existing FHA loan, and all of your mortgage payments need to have been on time the last 12 months
- Credit score of 620 or better
- You must own the property for at least 6 months before trying to qualify for your streamline refinance
- You will need to work with an FHA approved banker or FHA loan broker. While you can use your current lender, you are also free to choose any bank approved by HUD to do FHA loans. My bank, First National Bank, has been a HUD approved lender since 1934, the year after the program was released!
- FHA Streamline loans still do not require an appraisal, but no-appraisal FHA loans cannot exceed your current principal balance. This is an important change from past years, and took effect November 2009.
- Closing costs are either to be paid up front at the closing table or arranged for through a “no-cost” FHA Streamline loan (higher rate is used to pay your closing costs). You can also include the FHA streamline closing costs into your loan by doing a “with appraisal” FHA Streamline loan. The catch here is that you have to have sufficient equity to cover the extra closing costs.
