Key Features of FHA Streamline Refinance

Have you already borrowed an FHA insured loan? Are you now facing problems in making regular monthly mortgage payment due to its high amount? Do you think you can pay regularly if the amount is reduced a little? If your answer to these questions is 'Yes', then FHA streamline refinance is the best option for you. It will not only help you pay your regular monthly mortgage but also in keeping your home and in return, saving your credit. Key features of the FHA streamline refinance program are as follows:

The loan that is to be refinanced must already be FHA insured.

The mortgage to be refinanced must be current and existing NOT delinquent.

HUD's Credit Alert Interactive Voice Response System (CAIVRS) check not required.

Checking HUD's Limited Denial of Participation (LDP) and General Services Administration (GSA) exclusion lists are required by all borrowers.

FHA does not ask for a Credit report (except for credit qualifying refinance) and termite inspection.

Borrowers do not need to sign the loan application until loan closing.

The refinance should result in reduction in borrower's monthly mortgage payment that includes principal and payment towards interest.

No cash back to the borrower, except not more than $250 for minor adjustments at closing.

Streamline refinances can be made with or without an appraisal.

Form HUD 92564-VC is required for streamline refinances with appraisal.

Homebuyer Summary is not required for streamline refinances with an appraisal.

FHA does not require repairs to be completed (except for lead-based paint repairs).

Mortgage amount should exceed the statutory limits only by the amount of any new up-front MIP.

Cash-to-Close: Borrowers do not need evidence of cash for loan closing.

Condominium Approvals Withdrawn: FHA insures only streamline refinance without appraisal if the approval for any condominium project has been withdrawn.

Underwriting: Not required except in case of credit qualifying streamline refinance.

Information regarding income, obligations, debts and assets is not required unless the borrowers are credit qualified.

Shortening the Term of Mortgage: A shorter-term FHA streamline refinance can be given if the monthly mortgage payment does not exceed the previous by an amount of $50.

Delinquent Mortgages: Streamline refinance can't be offered to delinquent mortgages. However, if the mortgage is made current, refinance can be offered.

"No-Cost" Refinances: In no cost refinance, lenders charge higher rate of interest to meet the closing cost. There is no out of pocket expense with the enhanced monthly payment.

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