You will accomplish two things when you Streamline your FHA refinance. You will save money. You will save time.
How Will You Save Money?
The Streamline FHA refinance is designed to save you money. It saves money in the following ways:
- Since the Streamline FHA refinance must save the borrower money, the new monthly payment must be 5% less than the original monthly payment
- The amount of the FHA mortgage insurance premium included in the monthly payment decreases which makes your new monthly payment lower
- Borrowers can take advantage of the current lower interest rates.
How Will You Save Time?
The Streamline FHA Refinance was also designed to save time. This refinance option requires that less paperwork needs to be submitted to the lender, thereby saving time. Borrowers are not required to submit to a credit check. They do not need to submit to income verification. They do not need cash to settle the refinance.
Borrowers do not need an appraisal. This feature has increased Streamline’s popularity for those refinancing underwater property mortgages. Underwater property borrowers can use their original home appraisal.
Borrowers are not required to make repairs to the property being refinanced. The one exception to this rule is that the property must be free of lead-based paint. All leaded-based paint must be removed.
Do You Qualify for the Streamline FHA refinance?
According to the U.S. Department of Housing and Urban Development (HUD), the following requirements must be met for the borrower to qualify:
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- The original mortgage must be an FHA loan
- The original mortgage must in good standing and not delinquent
- The new monthly payment for the refinanced mortgage must be at least 5% less than the original mortgage payment
- Only cash for settlement expenses up to $500 may be taken out with refinance
- Your FICO credit score must 620 or higher
- Your original mortgage must be past the waiting period of 210 days
- Your original mortgage must be past the waiting period of 210 days
- You cannot have more than one late payment for the current one-year-old mortgage.
- You cannot have any late payments for mortgage less than 12 months
Streamline FHA Refinance is available using mortgage brokers such as mortgage broker buffalo ny.
What is the Streamline FHA Refinance?
The Federal Housing Administration created the FHA Streamline Refinance and made it available to the public in mid-April 2016. According to Wikipedia, streamline refinancing was introduced to speed up the home refinancing process. The goals of this refinance option are to quicken FHA mortgage loan processing by requiring less paperwork and loosening underwriting requirements.
A Streamline FHA Refinance is suitable for borrowers that are in a hurry to refinance, do not have cash for settlement, desire a lower monthly payment and have a lower credit score. It is also suitable for borrowers refinancing an adjustable rate mortgage (ARM) or graduated payment mortgage (GPM) into a fixed rate mortgage. These borrowers just need to make sure their new interest rate is less than the original adjustable interest rate. A Streamline FHA Refinance will save you money and time.
