If you’re under an FHA mortgage loan and want to avoid the hassle of qualifying for mortgage refinancing, an FHA streamline refinance could be your answer. The FHA Streamline Refinance is simply the fastest way to refinance your FHA insured home loan; best of all you don’t need an appraisal. Here are several tips how to refinance with an FHA streamline from Dan Green at the Daily Mortgage Reports:
The FHA Streamline Refinance is a special mortgage product, reserved for homeowners with existing FHA mortgages. Homeowners with conventional mortgages via Fannie Mae or Freddie can’t use it.
Another great thing about the FHA streamline refinance is because there is no appraisal required your loan-to-value doesn’t matter. You can be fully underwater in your existing mortgage and still qualify. In areas of the country where loan-to-value ratios hit 200% like Florida and Arizona this is great news!
You should also know that there is no prepayment penalty and you have a choice of 15 or 30 year term-lengths. You don’t have to verify employment, prove income, or submit to a credit check as part of the process.
What’s the catch you ask? In order to qualify you can’t have any late payments for the last 12 months. Your loan must also be paid current at closing. You have to be at least six payments into your existing home loan and it must be at least 210 days since your last closing. Another catch is that any closing costs you incur cannot be rolled into your loan balance and refinancing must show some benefit to qualify. The downside of any FHA backed home loan is mortgage insurance.
You’ll be required to pay mortgage insurance premiums once at closing and every year as a condition of your home loan. The upfront mortgage insurance is one percent of your home loan so you’ll need to have this cash on hand to close your FHA streamline refinance. The annual mortgage insurance is based on your term length and loan-to-value ratio so if you’re underwater this is where you’re going to feel the pinch in your payments.
You can learn more about getting today’s lowest refinance mortgage rates without paying unnecessary fees at closing by checking out my free Underground Mortgage Videos.