FHA Streamline Refinance (Your 2019 Guide)
Do you have an existing FHA loan?
Would you like to lower the interest rate you’re paying on your existing FHA loan?
Well, you should know there’s a program that lets you refinance your FHA loan easily and quickly.
This program can potentially give you better terms than your current mortgage — lower interest rates, even lower monthly payments.
It’s called an FHA Streamline Refinance.
On this page, you will learn what is an FHA Streamline Refinance loan.
You also will learn how it works, its eligibility requirements and how Secure Choice Lending can help you obtain one.
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What is an FHA streamline refinance?
FHA Streamline Refinance is the fastest and easiest way to refinance an existing FHA loan to a lower rate. It also lets you reduce your FHA Mortgage Insurance Premiums (MIP).
FHA Streamline Refinance is all about saving you time and money by simplifying the home refinancing process.
The process eliminates a lot of the paperwork, including income and employment verification, credit score and bank account verification.
If you already have an existing FHA loan, this means you already have proven you have good credit risk for FHA to guarantee you a loan. Because of this, there is no need to calculate your debt-to-income (DTI) ratio for an FHA Streamline Refinance loan.
But its feature benefit is that it doesn’t require a home appraisal. Instead of an appraisal, the FHA Streamline Refinance will use your original purchase price as the current value of your home, regardless of what it is actually worth today.
FHA Streamline Refinance options:
- Fixed rate
- Adjustable mortgage
- 15- or 30-year term
Call Secure Choice Lending at (951) 707-9364 and our loan experts will answer all your questions about FHA Streamline Refinance.
What are the benefits of an FHA Streamline Refinance loan?
Easy to qualify
One of the big advantages in an FHA Streamline Refinance is that it is fairly easy to qualify.
Employment, income and credit scores are not verified to apply
According to FHA’s official mortgage guidelines, employment verification, income verification, and credit score verification are not required with an FHA Streamline Refinance.
That means you don’t have to collect your pay stubs, W2s or tax returns for approval. You also don’t have to worry about having a bad credit score.
With this in mind, even if you are out of work, have no income and have bad credit, you could still be approved for an FHA Streamline Refinance.
However, some lenders have their own credit score minimums. And most lenders will still ask for a credit report.
No appraisal necessary
FHA Streamline loans do not require an appraisal, making the process cheaper and quicker. Additionally, no equity is required.
However, if you opt to get an appraisal, you can include the closing costs in the new loan amount. Without an appraisal, you have to pay the closing costs yourself, or with a lender credit.
Also, if you do get an appraisal, your equity must be able to cover the existing balance of the loan, closing costs and any interest due on the loan.
Reduced monthly payments
An FHA Streamline Refinance permanently reduces your monthly payments. This type of loan is a good option if you are looking to have extra money at the end of the month to deposit into a savings account or put toward other financial goals.
This does not just benefit you. FHA also benefits because refinancing typically helps borrowers make payments on time. This trade-off decreases risk for FHA to pay for your lender because there is a lesser chance you default on your mortgage.
How do I qualify for an FHA Streamline Refinance?
Although the FHA Streamline Refinance loans have reduced paperwork and simple eligibility requirements, they still follow FHA basic requirements:
- Your current mortgage must be an FHA loan — The FHA Streamline Refinance loan is only available to those with an existing FHA loan. This is the most basic eligibility requirement.
- You have not missed any payments on your current FHA loan — You must have already made at least six monthly payments. Additionally, you must have had your current FHA loan for at least 210 days before applying for an FHA Streamline Refinance loan.Most lenders will not accept applicants with delinquent monthly payments. However, some lenders won’t disqualify you if you haven’t missed your deadline payment for more than 30 days and you’ve had your FHA loan less than a year.Call Secure Choice Lending at (951) 707-9364 to find out if you are eligible for an FHA Streamline Refinance loan.
- There must be a Net Tangible Benefit from the refinance — A borrower must have a legitimate reason for an FHA Streamline Refinance loan.A “Net Tangible Benefit” generally means reducing the “combined rate” by at least half of 1%.For a refinance benefit to be considered a “Net Tangible Benefit,” certain things must apply. Taking cash out to pay the bills is not considered to be a “Net Tangible Benefit.”FHA Streamline Refinance is not a “cash out” refinance program. In fact, you probably won’t get more than $500. The main benefit of this program is to permanently reduce monthly payments.Call Secure Choice Lending at (951) 707-9364 and we will be happy to find out if you are eligible for an FHA Streamline Refinance loan.
Secure Choice Lending can assist you with an FHA Streamline Refinance
FHA Streamline Refinance loans are the fastest and easiest way to refinance your existing FHA loan. To get through the process quicker and to reduce your monthly payment sooner, call Secure Choice Lending today.
Our loan officers are happy to answer all your questions and discuss your options.
Secure Choice Lending is a full-service mortgage broker that will secure you a mortgage that doesn’t break the bank.
To streamline the lending experience, our team of financial experts matches consumer needs with the appropriate loan programs and level of risk. With loan officers versed in all mortgage types, solutions to your home-buying questions are a phone call away.
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