November 12th, 2019 7:40 AM by Jackie A. Graves, President
Streamline is a refinance mortgage loan available to homeowners with existing
FHA mortgages. The program simplifies home refinancing by waiving the
documentation typically required by a bank, including income and employment
verification, bank account and credit score verification, and an appraisal of
the home. Homeowners can use the program to reduce their FHA mortgage insurance
NOTE: FHA mortgage guidelines change often. This FHA Streamline
Refinance information is accurate as of today, November 12, 2019.
here to check your FHA Streamline Refinance Eligibility. (Nov 12th, 2019)
What is an FHA
FHA MIP refund chart
FHA MIP cancellation
Streamline Refinance is a special mortgage product, reserved for homeowners
with existing FHA mortgages.
Streamline Refinances are the fastest, simplest way for FHA-insured homeowners
to refinance their respective mortgages into today’s mortgage rates.
Streamline Refinance program’s defining characteristic is that it does not
require a home appraisal.
the FHA will allow you to use your original purchase price as your home’s current
value, regardless of what your home is actually worth today.
way, with its FHA Streamline Refinance program, the FHA does not care if you
are underwater on your mortgage. Rather, the program encourages underwater
Click here to refinance with FHA even if you are
you owe twice what
your home is now worth, the FHA will refinance your home without added cost or
“appraisal waiver” has been a huge hit with U.S. homeowners,
allowing unlimited loan-to-value (LTV) home loans via the FHA Streamline
in places like Florida, California, Arizona and Georgia have benefitted
greatly, as have homeowners in other states and cities affected by last
decade’s housing market downturn.
this “no appraisal” feature, however, the FHA Streamline Refinance behaves very
much like any other loan product.
available as a fixed rate or adjustable mortgage; it comes as a 15- or 30-year
term; and there’s no FHA prepayment penalty to worry about.
big plus is that FHA mortgage rates are the same in the FHA Streamline
Refinance as with a “regular” FHA loan.
There’s no penalty for being underwater, or for having very little equity.
low FHA Streamline Refinance rates here. (Nov 12th, 2019)
big plus is that the FHA Streamline Refinance is fairly easy for which to
this decade, in an effort to help U.S. homeowners, the FHA abolished most of
the typical verifications required to get a mortgage. So, today, as it’s
written in the FHA’s official mortgage guidelines :
1. Employment verification is not required with an FHA
2. Income verification is not required with an FHA Streamline
3. Credit score verification is not required with an FHA
no need for a home appraisal, either, so when you put it all together, you
can be (1) out-of-work, (2) without income, (3) carry a terrible credit rating
and (4) have no home equity. Yet, you can still be approved
for an FHA Streamline Refinance.
not as crazy as it sounds, by the way.
understand why the FHA Streamline Refinance is a smart program for the FHA, we
have to remember that the FHA’s chief role is
to insure mortgages — not “make” them.
the FHA’s best interest to help as many people as possible qualify for today’s
low mortgage rates. Lower mortgage rates means lower monthly payments
which, in theory, leads to fewer loan defaults.
good for homeowners that want lower mortgage rates and for the FHA — but mostly
for the FHA.
today's FHA Streamline Refinance rates here. (Nov 12th, 2019)
the FHA Streamline Refinance eschews the “traditional” mortgage verifications
of income and credit score, as examples, the program does enforce minimum
standards for applicants.
official FHA Streamline Refinance guidelines are below. Note that not all
mortgage lenders will underwrite to the official guidelines of the Federal
main goal is to reduce its overall loan pool risk. Therefore, it’s number one
qualification standard is that homeowners using the Streamline Refinance
program must have a perfect payment history stretching back 3 months. 30-day,
60-day, and 90-day lates are not allowed.
late payment is allowed in the last 12 months. Loans must be current at the
time of closing.
requires that borrowers make 6 mortgage payments on their current FHA-insured
loan, and that 210 days pass from the most recent closing date, in order to be
eligible for a Streamline Refinance.
here to check your FHA Streamline Refinance eligibility now. (Nov 12th, 2019)
does not require verification of a borrower’s employment or annual income as
part of the FHA Streamline process.
no Verification of Employment, nor are there paystubs, W-2s or tax returns
required for approval.
be unemployed and get approved for a FHA Streamline Refinance so long as you
still meet the other program requirements.
does not verify credit scores as part of the FHA Streamline Refinance program.
Instead, it uses payment history as a gauge for future loan performance.
means that FICO scores below 640, below 620, below 580, and
below 500 are eligible for Streamline Refis.
lenders, however, create their own minimums. Check your lender’s guidelines
Refinance applicants must demonstrate that there’s a Net Tangible Benefit in
the refinance; a legitimate reason for refinancing.
Net Tangible Benefit is defined as reducing the “combined rate” by at
least one-half of one percent.
instance, the homeowner has an FHA loan opened
in May 2013 with a rate of 5.00%, and a monthly mortgage insurance premium
equal to 1.35%. The combined rate is 6.35%.
homeowner receives a rate quote at 4.75% with MIP of 0.85%. She saves on her
rate and mortgage insurance, since FHA MIP was reduced in
combined rate would be 5.60%, or three-quarters of one percent lower than the
existing combined rate. The FHA refinance is eligible.
allowable Net Tangible Benefit is to refinance from an adjusting ARM into a
fixed rate loan. Taking “cash out” to pay bills is not an allowable Net
here to verify your FHA rate reduction. (Nov 12th, 2019)
prohibits increasing a Streamline Refinance’s loan balance to cover associated
loan charges. The new loan balance is limited by the math formula of (Current
Principal Balance + Upfront Mortgage Insurance Premium). All other costs —
origination charges, title charges, escrow population — must be either (1) Paid
by the borrower as cash at closing, or (2) Credited by the loan officer in
latter is called a “zero-cost FHA Streamline”.
isn’t concerned about home value — it’s insuring your loan regardless.
the FHA does not require appraisals for its Streamline Refinance program.
Instead, it uses the original purchase price of your home, or the most recent
appraised value, as its valuation point.
that are underwater are still FHA Streamline-eligible.
take extra cash when refinancing with an FHA streamline loan. This refinance is
mainly for the purpose of dropping your rate and payment.
the FHA cash out refinance is another product offered by the FHA. It allows you
to open a loan of up to 80% of your
home’s value. If that amount is larger than your current loan
balance, you take the difference in cash.
funds for any purpose: pay off debt, improve your home, or create an emergency
Streamline Refinance is an FHA-insured mortgage, and FHA borrowers are required
to make two types of mortgage insurance payments — an upfront mortgage
insurance payment paid at closing, plus an annual payment split into 12
installments, paid with your mortgage payment each month.
respect to mortgage insurance premiums, homeowners using the FHA
Streamline Refinance program are split into two classes:
1. Homeowners whose new loan replaces an FHA-backed mortgage
endorsed prior to June 1, 2009
2. Homeowners whose new loan replaces an FHA-backed mortgage
endorsed on/after June 1, 2009.
in the first class — those with “old” FHA mortgages —
are assigned different mortgage insurance than newer FHA homeowners.
older FHA mortgage qualify for a reduced upfront premium of just 0.10% of the
loan amount, or $10 for every $100,000 borrowed. Additionally, monthly mortgage
insurance is just 0.55% of the loan amount annually, compared to “regular” MIP
of 0.85% per year.
are refinancing an FHA mortgage via the FHA Streamline Refinance program and
your existing FHA mortgage was endorsed on, or after, June 1, 2009, your
mortgage insurance premium schedule on your new FHA loan is as follows.
FHA Streamline Refinance replacing a loan endorsed on, or after, June 1, 2009,
the FHA upfront mortgage insurance premium is equal to 1.75 percent of your
loan size, or 175 basis points.
This is $1,750
for every $100,000 borrowed. The FHA automatically adds the $1,750 premium to
your loan balance for you — it’s not paid as cash. However, not all refinancing
households will pay the full amount.
FHA-backed homeowners refinancing within the 3 years of their existing loan’s
start date, the FHA provides a refund on your previously-paid upfront MIP.
of the refund diminishes as the 3-year window elapses.
example, a homeowner who refinances an FHA mortgage after 11 months is
granted a 60% refund on his initial FHA UFMIP. 30 days later, the refund drops
to 58%. After another 30 days, it drops to 56%, and so on.
why is rarely a good idea to “wait to refinance” with the FHA. With the
FHA Streamline Refinance program, the sooner you refinance, the bigger your
refund, and the lower your total loan size. This lowers the monthly payment and
preserves the home equity — two huge positives.
mortgage insurance refund check accompanies every rate quote. Request that
here. (Nov 12th, 2019)
annual MIP schedule for an FHA Streamline Refinance which replaces a loan from
on, or after, June 1, 2009 is as follows :
15- & 30-year loan
terms with an LTV over 90%: 0.55 percent annual MIP, payable for the life of
15- & 30-year loan
terms with an LTV under 90%: 0.55 percent annual MIP, payable for 11 years
these MIP costs may be lower than what you’re paying currently.
January 2015, the FHA lowered its mortgage insurance premiums on 30-year loans,
making it less expensive to carry an FHA home.
current FHA MIP is higher than what’s shown above, consider starting a
refinance immediately to benefit from a new, lower FHA MIP.
existing FHA mortgage was endorsed prior to June 1, 2009, your mortgage
insurance premiums have been “grandfathered”.
refinance via the FHA Streamline Refinance program and pay reduced rates for
both for upfront MIP and your annual mortgage insurance premium.
here to see how much you can save by reducing your FHA MIP. (Nov 12th, 2019)
FHA Streamline Refinance that replaces a loan endorsed prior to June 1, 2009,
the new FHA mortgage’s upfront mortgage insurance is equal to 0.01 percent of
the loan size, or 1 basis point.
example, if your new FHA Streamline Refinance is for $100,000 mortgage, the FHA
will assess a $10 upfront mortgage insurance premium (MIP) to be paid at
closing. The FHA automatically adds the $10 payment to your new loan balance.
MIP is similarly cheap for older FHA loans. For an FHA Streamline Refinance
replacing an FHA loan endorsed prior to June 1, 2009, the annual MIP is
0.55% annually, or 55 basis points.
complete annual MIP schedule is as follows :
requires some homeowners to pay mortgage insurance for as long as their loan is
your FHA Streamline Refinance replaces a loan from on, or after, June 1,
2009, the rules on your FHA MIP cancellation are as follows:
LTV of 90% or less at the
time of closing: MIP is required for 11 years
LTV greater than 90%
at the time of closing: MIP required for life of loan
MIP cancelation policy applies to 15-year loan terms and 30-year loan terms
refinancing homeowners are welcome to bring cash to closing in order to reduce
their loan balance and change their MIP disposition. However, not everyone will
have the cash to make such a move.
why, when exploring an FHA Streamline Refinance, you should also look
other refinance programs including the conventional mortgage loan via Fannie
Mae or Freddie Mac, which is available with nearly every mortgage lender.
allows its homeowners to refinance to
cancel FHA MIP.
mortgage rates are low and homeowners typically close in less than 30 days.
Remember: the faster you close, the bigger your FHA MIP refund.
today’s live mortgage rates now. Your social security number is not required to
get started, and all quotes come with access to your live mortgage credit
me today's rates (Nov 12th, 2019)
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