FHA Streamline Refinancing Benefits and Rules
FHA Streamline Refinancing Benefits and Rules,.
As you know, FHA home loans have fantastic benefits. You’ve also heard that FHA’s streamline refinancing is cheaper and simpler than other refinance programs. If it’s true how do you take advantage?
Let’s cover the benefits first.
1. FHA’s streamline refinancing eliminates some underwriting requirements, reduces the amount of paperwork involved in getting the new loan.
Specifically,This means you don’t have to bring tax returns, pay stubs, bank statements or W-2 forms. The thinking now is that since you qualified once and have made timely payments, you’re a good risk still.
2. You no longer need a new appraisal if you’re not going to do a cash-out remortgage or refi|If you are not going to take cash out, FHA does not require an appraisal. This, obviously, saves you time and money. FHA doesn’t want an appraisal even if you’re in a neighborhood with declining home values.
3. Since your finances are no longer required, you can avoid the higher interest rates that come from refinancing or remortgaging with bad credit.
Now, the rules. There are 5, and they don’t go against common sense.
1. You can only streamline refinance FHA loans.
2. If the mortgaged property’s become an investment property, you always need an appraisal. (Yes, you can take an FHA mortgage only on your primary residence. However, you CAN refinance an FHA mortgage on a property that’s no longer your primary residence.)
3. You can’t be behind with your mortgage payments and and there cannot be any late payments in the previous 12 months.
4. The refinance must reduce the principal and the interest.
5. No cash-out allowed.
If you’ve determined that you need to refinance and already have an FHA-insured home loan, FHA’s streamline program is a great option for you, especially if your circumstances have changed for the worse. Instead of doing a bad credit or refinance, now you can simply go with FHA’s streamlined program.
Dan M. Kennedy
In case you are trying to find information about luxury vacation home rentals, make sure to check out the web page that is quoted in this passage.
Posted by
on October 23, 2010. Filed under 
Recent Comments