The FHA or Federal Housing Administration, has a streamline refinance program that is provided by HUD (Department of Housing and Urban Development) for existing FHA mortgagee’s to refinance quick and easy.
A lot of borrowers have had success with the FHA Streamline Refinance and qualifying is quite a breeze. You will likely be able to refinance at a lower rate and reduce your monthly payment as well. Assuming your current mortgage is insured by FHA, it’s a great idea to look into the FHA Streamline Refinance to see what it can do for you and your wallet.
Although one of the biggest upsides to the FHA streamline is the minimal requirements, you still must have some qualifications in order to be approved. First, you must have a 90-day clean payment history. Another requirement is that you must have owned your home for longer than six months. There are a few other things a lender will want to look at, one of which is to see if you have any delinquencies on current federal debt, i.e. tuition loans. If you do, you will unlikely be approved for the refinance. And they will check out your employment history to see if you have a steady and reliable income.
Of course, every person’s story and financial history is different, so the best way to know if you qualify is to find a lender. They will ultimately be the best person to tell you what refinance is best, and what you need to do to get it.
How it Saves You Money
If you are on the West coast and want to travel to New York, are you going to drive or hop on a plane? The most time-saving choice would be the airplane; that’s the streamline refinance. Who doesn’t want to get from point A to point B with fewer obstacles? The benefits of going with a streamline refinance rather than other options are many.
1) There are little to no closing costs.
2) If your new loan balance does not exceed your current loan amount there is no appraisal necessary.
3) Borrowers who have a scant credit score can still be approved at a lower rate.
3) Ultimately saving you thousands of dollars in interest.
Is it Right for You?
Let’s be honest– there is not a one size fits all when it comes to mortgages. But, on the bright side there is almost always a refinance out there that will save you money. Don’t be afraid to ask yourself some questions: how much can you afford each month for your mortgage? Do you see yourself living in your home for more than two or three years? Would you do better with a refinance that lets you consolidate other debt? The mortgage world can be a bit hard to navigate so if you are struggling to find out what your best option is, contact a lender to help lighten the load.