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FHA Streamline Refinance

FHA streamline refinance loans provide a unique opportunity for homeowners who have no equity to refinance into a lower payment. The FHA streamline loan is a rate and term refinance option that should not be overlooked.  FHA mortgage loans with cash out are not allowed with the streamline program. 

The low rate streamline refinance program is a genuine opportunity for FHA customers to lower their interest rate cost effectively.  There is  a no cash out FHA mortgage loan.

Best FHA Streamline Rates from Nationwide!

  • No Income Documentation
  • No Formal Appraisal
  • Lender Cost Reductions

1. You have to have made at least six payments on your current FHA loan.

2. If you have had your FHA loan for less than 12 months, all the loan payments must have been made in a timely manner. If you have had the FHA mortgage for more than 12 months, you can have been late only once in the last year and must have paid on time the last 3 months.

3. Your new FHA loan payment must be at least 5% lower than your old payment, or you must be replacing an ARM with a fixed loan (the new FHA rate can’t be more than 2% higher) or hybrid loan (the new loan payment can’t be more than 20% higher), or reducing the term of your FHA loan, or reducing your interest rate by at least 2% (if replacing a fixed home loan with an ARM).

4. The property being refinanced must be your primary residence.

5. Closing costs for FHA streamline loans must be paid upfront (with the exception of mortgage insurance premium (MIP), which can be financed in the new loan.

Here’s an example. Julie and Bill have a $300,000 FHA mortgage that is fixed at 6.25% on a 30-year amortization. Their FHA mortgage is 1 year old, and they have not been late on their loan payments. To qualify for a FHA streamline refinance, they need to lower their payment by 5%. To qualify for the FHA streamline they would need an FHA mortgage rate of 5.75% to meet the new FHA guidelines. If the borrowers want an ARM, they would have to qualify for a FHA rate below 4.25%. The good news is that with today’s low market rates, these borrowers would qualify for a FHA  loan refinance under streamline initiative that saves them over a thousand dollars a year. This is a unique opportunity because these borrowers owe more than their home is worth.  When they applied for a refinance with conventional lenders they were rejected because of their lack of equity, but with a FHA lender they still qualify for another great FHA mortgage.

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