FHA Streamline Mortgage

The FHA has created a rate reduction program called the FHA Streamline Mortgage. This provides a way for current FHA homeowners to lower their interest rate with little or no out-of-pocket costs. These loans can also be made faster and with less documentation than a typical loan. No Cost FHA Streamline Mortgage lets you refinance your mortgage with no out-of-pocket expenses. One option is to let the lender pay the costs in exchange for a higher interest rate. Another option that lets you obtain market rates is to roll the closing costs into the new loan. If you currently have an FHA mortgage you are eligible for one of the simplest money saving refinances available today. The FHA Streamline Mortgage. 

The FHA Streamline Mortgage refers only to the amount of documentation and underwriting that needs to be performed by the lender, and does not mean that there are no costs involved in the transaction. The basic requirements of a FHA Streamline Mortgage are: 

• Borrower's original loan must already be an FHA insured loan.
• The refinance must lower the principal and interest payments of the previous mortgage payment.
• The mortgage must have been paid as agreed for the last twelve (12) months and must be up to date at the time of refinancing. Borrower must have had the FHA mortgage for 6 months.
• Borrower cannot receive any cash back
• No income or employment verification - No pay stubs or W-2 forms - No termite report.
• Appraisal only required if rolling in the closing costs. Streamlines without an appraisal are limited to the unpaid principal balance, minus any refund credit of the mortgage insurance premium, plus the new upfront MIP if it is to be financed in the mortgage.
• Any other liens must be subordinated to the FHA loan.
• Borrower must be up-to-date on any federal debts.

FHA Streamline Mortgage refers only to the amount of documentation and underwriting that needs to be performed by the mortgage company, and does not mean that there are no costs involved in the transaction. Lenders may offer FHA Streamline Mortgage in several ways. Some lenders offer "no cost" refinances by charging a higher rate of interest on the new loan than if the borrower financed or paid the closing costs in cash. From this premium, the lender pays any closing costs that are incurred on the transaction. The mortgage to be refinanced must already be FHA insured. The mortgage to be refinanced should be current (not delinquent). The refinance is to result in a lowering of the borrower's monthly principal and interest payments. No cash may be taken out on mortgages refinanced using the streamline refinance process.