HUD FHA Streamline

HUD FHA Streamline Refinance Lenders With Best Rates

ByAlex Carlucci

HUD FHA Streamline Refinance Lenders can help homeowners with an FHA loan refinance to a new FHA streamline refinance loan with the best rates. HUD FHA Streamline Guidelines is a fast-track refinance mortgage program with limited documents required. Mortgage Rates are at a 13 month low due to the FED Freezing Interest Rates for the remaining 2021. With the freeze of interest rates by the Federal Reserve Board, industry experts expect mortgage rates to further drop in 2022. Many homeowners who closed their FHA Loans last year in 2020, closed them with high mortgage rates.

HUD FHA Streamline Mortgage Rates Today

2018 had the highest mortgage rates since the 2008 Great Recession and Housing Bubble Crash. Mortgage rates had steadily been declining since the beginning of 2019. Rates are expected to further drop in the weeks and months to come. This gives homeowners with FHA Loans to go through HUD FHA Streamline Refinance in the weeks and months to come. In this blog, we will discuss FHA Streamline Refinance Guidelines. We will discuss the net tangible benefits for the borrowers when refinancing with HUD FHA Streamline.

Is HUD FHA Streamline Refinance A Good Idea?

Under FHA Streamline Refinance Mortgage Guidelines, homeowners with a current FHA Loan can refinance their current loan to a new FHA Loan at lower interest rates. HUD FHA Streamline Refinance is a fast-track loan program that streamlines the process with little limited documentation required. Most Streamlines close in 21 days or less. There is no home appraisal required. There are no income docs required so DTI will never be a problem. There are two types of HUD FHA Streamline Refinance Loans. Credit Qualifying and NON-Credit Qualifying Streamlines.

FHA Streamline Refinance Loan Credit History Requirements

Borrowers can have bad credit and low credit scores with late payments in the past 12 months and can qualify if they just have their FHA Loan Payments paid timely. To get the best mortgage rates, a higher credit score will be required. In order to qualify, they need to be on a current FHA Loan. No late payments in the past 12 months are preferred. However, need to have been current in the past 6 months prior to the FHA Case Number Assignment. The mortgage needs to be in good standing and cannot have any 30-day late payments in the prior six months to the FHA Case Number Assignment Borrowers can have no more than one 30 days late in the past 12 months but not in the past 6 months.

FHA Streamline Refinance Net Tangible Benefit Requirements

In order to qualify, borrowers must meet a net tangible benefit. HUD FHA Streamline Refinance is for rate and term only. Cash-outs are not allowed with streamlines. There are no credit score requirements, no home appraisal, and no income docs required. A borrower with higher credit scores can qualify with credit qualifying streamlines for lower mortgage rates.

Benefits With Refinancing With FHA Streamline Refinance Loans

In order to be eligible for streamlines, borrowers need to meet the net tangible benefit test. Other benefits include the following. Refund of the escrow account. If there is an escrow shortage, a new escrow account will be created with the shortage amount replenished. Borrowers often get to skip two mortgage payments. Eligible properties include single-family homes, townhouses, condos, PUD.

FHA Streamline Mortgage Process During Bankruptcy

Borrowers cannot qualify for a streamline during an active Chapter 7 bankruptcy process. The Chapter 7 bankruptcy needs to be discharged. There is no waiting period seasoning requirement after a Chapter 7 Bankruptcy. Borrowers can qualify for streamlined refinancing during an active Chapter 13 Bankruptcy. repayment plan after one year in the plan. Need trustee approval. No waiting period after Chapter 13 Bankruptcy discharged date.

Valuable HUD Resource Links On FHA Loans

Here are valuable Resources and valuable links:

Here is the HUD Mortgagee letter 2015-01 on the revised FHA MIP effective January 26, 2015.

Click Here

Here is more information by HUD in meeting the net tangible benefit test for borrowers:

Click Here

For more information on HUD FHA Streamline Mortgage Guidelines, please contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com. We are a mortgage company licensed in multiple states with no overlays on FHA Loans. We are available 7 days a week, evenings, weekends, and holidays.

FHA Streamline Refinance Step By Step Mortgage Process

Homeowners with a current FHA loan can refinance their FHA loans in a fast-track FHA streamline loan with no money out of pocket and be able to skip at least one monthly mortgage payment and possibly two payments. If you currently have an FHA-insured mortgage loan and if mortgage rates on FHA loans are still in the 4.0% to 5.0% range, you may want to consider refinancing your current FHA loans with an FHA Streamline loan with no closing costs by borrowers.  Today’s mortgage rates are at historic lows.

What Documents Are Required To Start The FHA Streamline Refinance Loan Process

An FHA Streamline refinance is a fast-track refinance loan program for homeowners with a current FHA loan. Homeowners with an FHA loan can refinance their current FHA Loan with another FHA loan at a lower rate without paying for another appraisal and no money out of pocket.  There is no income verification required so no worries about debt to income ratio requirements. There is zero stress during the mortgage process. There is limited paperwork required. Your loan officer will do most of the work on streamlines. Most streamlines can close in two to three weeks.

FHA Streamline Requirements On Borrowers And Non-Occupant Co-borrowers

In order to qualify for an FHA streamline loan, all borrowers on the original FHA loan need to be on the new FHA refinance loan. HUD, the parent of FHA, made the FHA streamline loan program very easy due to the following reasons:

  • Under the eyes of HUD, the agency already initially qualified and approved the borrowers and the property.
  • Since HUD is already insuring the property, why should they require a new appraisal?
  • Whether the property went up in value or dropped significantly in value, HUD feels if the homeowner has been paying timely on their FHA loan, they will continue to pay timely on future payments on the new FHA streamline loan.
  • The homeowner’s new streamline loan will have lower monthly payments.
  • Therefore, it will bring a net tangible benefit for the borrower.
  • The most important factor HUD requires is the borrower has been timely on all of their housing payments.
  • Other monthly debt payments do not matter whether or not the borrower was timely.

No income verification is required, no appraisal is required and no credit scores are required.  However, if you have high credit scores, we can include credit scores to get the best possible mortgage rate.  FHA Streamlines reward FHA borrowers with high credit scores. The higher the credit scores the lower the rate. Credit scores are the determinant of rates on the new loan.

FHA Streamline Guidelines With Recent Late Payments?

The FHA Streamlines no credit scores required allows homeowners with low credit scores, derogatory credit, recent late payments, and recent derogatory credit to qualify for an FHA Streamline Refinance. These loans programs are non-FICO score-driven. Homeowners can still qualify for an FHA Streamline as long as they have been timely on all mortgage payments in the past 12 months. Homeowners can be on all of your credit obligations but not on their FHA mortgage payments.  A one-time 30-day late payment is allowed. However, the late payment cannot have been in the past 3 months.

FHA Streamline Turnaround Time From Application To Closing

If you currently have an FHA-insured mortgage at a higher interest rate, you may want to consider FHA Streamline where no appraisal, no credit scores, and no income verification is required.  There is no money out of pocket for the borrower and no closing costs. Most FHA Streamline Refinance loans can close in 21 days or less.  There is only a limited amount of paperwork required. Many homeowners still have an FHA loan with higher than 5.0 mortgage rates.

FHA Streamline Refinance Net Tangible Benefit Requirement 

Today’s mortgage rates are at historic lows. Anyone with an FHA loan with rates in the 4.0% to 5.0% can definitely benefit by going through an FHA streamline. There is no stress on FHA and VA streamlines. This is why it is called streamlines. FHA and VA loans are the only two government loan programs that offer streamline refinances. Cash-out refinances and taking out a co-borrower cannot be done on streamlines. Cash-out refinance are full doc refinance mortgages. All borrowers and co-borrowers on the original FHA loan need to be on the mortgage docs on the new streamline refinance.

FHA Loan Requirements On Credit Payment History

You can have recent late payments and still qualify for the FHA Streamline Refinance Loan. However, we do require that you have been timely with your mortgage loan payment for the past 12 months. One 30-day late payment in the past 12 months is allowed. There is no credit score minimum requirement with the FHA Streamline Loan program is non-FICO score driven. You can qualify for the FHA Streamline Refinance program as long as you have just been timely with your mortgage payment in the past 12 months. There is no appraisal required with the FHA Streamline Loan. There is no income verification with the FHA Streamline Loan program so your debt to income ratios will never be an issue.

How Do I Get Started On The Streamline Mortgage Process?

Very easy to get started on an FHA refinance mortgage loan. Several documents will be requested such as your mortgage recent mortgage billing statement,  your HUD-1 Settlement Statement, and a copy of the mortgage note.  Most FHA Streamline mortgage lenders will process, underwrite, and close the loan no later than 21 days from the date the mortgage loan application is signed and loan disclosures acknowledged. To take advantage of an FHA and/or VA streamline refinance mortgage, please contact us at Gustan Cho Associates at gcho@gustancho.com or call us at 800-900-8569. Or text us for a faster response.

FHA Streamline Mortgage Lenders With No Overlays

The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays. Gustan Cho Associates is a mortgage company licensed in multiple states with no lender overlays on government and conventional loans. Gustan Cho Associates has dozens of lending partnerships with non-QM alternative wholesale lenders. Therefore, Gustan Cho Associates has the ability to be a mortgage banker where we originate, process, underwrite, and fund government and conventional loans under our name plus we have the ability to broker loans such as non-QM and alternative mortgage loans.

FHA Streamline Lenders With Competitive Mortgage Rates

FHA Streamline Refinance Mortgages are very popular for homeowners with a current FHA loan that has higher rates. Mortgage rates are still at historic record lows. Thousands of homeowners have mortgage rates at 4.0% or higher who can benefit from FHA streamlined refinance mortgages. This is due to the large percentage of homeowners with high-interest rate FHA Loans.

Mortgage Rates On FHA Loans Are At Near Historic Low’s

Just a few years ago, standard mortgage rates on FHA loans exceeded 5%. Mortgage rates on FHA loans dropped under 3.0% earlier this year. Mortgage rates are definitely creeping up and are expected to start increasing at a faster pace beginning 2022. Homeowners making the decision to refinance home loans with an FHA Streamline Refinance Mortgages can save tens of thousands of dollars over the course of their loan term. There are several factors homeowners need to keep in mind and have under consideration.

Save By Taking Time To Refinance Your FHA Loan With HUD FHA Streamline Refinance

Homeowners with current FHA Loans with rates higher than 4.5% can benefit from FHA Streamline Refinance Mortgages. No closing costs: Gustan Cho Associates can potentially cover closing costs with a lender credit. Borrowers who do an FHA Streamline Refinance Mortgages In Kansas benefit from skipping two mortgage payments. No credit scores are required but we highly recommend going with a credit qualifying FHA streamline refinance.

FHA Streamline Refinance Mortgages With Bad Credit

Borrowers can have bad credit and recent late payments:
  • The only credit requirement is that homeowners need to be timely just on their FHA mortgage payments for the past 12 months
  • However, it is best recommended for homeowners to do a credit qualifying streamline refinance.
  • Homeowners with higher credit scores will get better mortgage rates.
  • The higher your credit scores, the lower your mortgage rates.
  • The team at Gustan Cho Associates are experts in helping our borrowers maximize and boost their credit scores with just a few quick fixes.

FHA Loan Requirements On Income Verification On HUD FHA Streamline Refinance Mortgages

No income verification:
  • Tax returns, W2s, and paycheck stubs are not required so debt to income ratios is not an issue

HUD Guidelines On Home Appraisals On FHA Streamline Refinance Mortgages

No appraisal required:
  • Limited documents are required since it is an FHA streamline refinance mortgages
  • Most FHA Streamline Refinance Mortgages close in two to three weeks

Understanding the FHA Streamline Guidelines And Benefits 

Homeowners with current FHA loans should fully understand the basic FHA Streamline Refinance Mortgages Guidelines for homeowners with a current FHA loan. There are still many homeowners with FHA loans with higher than 4.5% mortgage rates. Many homeowners are under the belief there will be stress and a lot of red tape in refinancing. This is so not true. Call us today and we will explain how simple an FHA streamline refinance is. The streamline refinance mortgage process is nothing close to the full doc initial home purchase mortgage process.

How Long Are You Planning On Keeping Home?

It does not matter how long homeowners will stay in their current homes with an FHA Streamline Refinance Mortgages because there are no closing costs. One of the greatest benefits with a no closing cost FHA Streamline Refinance Mortgages is that the homeowner will skip up to two months of mortgage payments PLUS they will have an instant reduction on their new housing payment. FHA Streamline Refinance Mortgages is not like a regular full refinance mortgage where borrowers need to pay for closing costs and/or points.

Comparing Streamlines To Refinance Home Loans

Unlike FHA Streamline Refinances with no closing costs, if homeowners need to pay for closing costs, then the length of the time they intend in staying at their current home does matter to recoup their closing costs. With every mortgage transaction, there are closing costs unless the lender will give a lender credit towards a homeowner’s closing costs. Closing costs can be rolled into the balance of the mortgage loan balance.

Closing Costs On FHA Streamline Refinance Mortgages

Here is how closing costs are paid on a mortgage refinance transaction: Closing costs paid by homeowner:
  • Homeowners who are planning on moving to a larger home
  • or downsizing to a smaller home within the next three years, it will probably not make much sense in refinancing current home loan if the homeowner needs to cover the closing costs
Refinance home loan costs money in closing costs, and depending on which county and state your home is located in, closing costs can add up to be thousands of dollars:
  • Depending on how much the new mortgage interest rates will be, the closing costs can be rolled into the mortgage loan but there is a break-even period to recoup your refinance home loan closing costs
For example, if your closing costs on a refinance home loan are $2,400 and borrowers can save $100 per month by refinancing their home loan, it will take 24 months for you to recoup the closing costs of the refinance home loan.

Paying Discount Points For Lower Mortgage Interest Rate

Discount Points is when a borrower pays a premium to buy down the mortgage interest rate:
  • Homeowners planning to stay in their home for at least three to five years, it may make sense to buy down the mortgage interest rates with “points”
  • One mortgage point is equivalent to 1.0% of the mortgage loan amount
  • Lenders can give lender credit for mortgage rate buy-downs and closing costs but borrowers can get even lower rates by buying discount points
Borrowers refinancing with a traditional refinance mortgage can avoid coming up with cash out of pocket by adding the points and the closing costs to the balance of their new mortgage loan. Homeowners can do some quick credit fixes to boost their credit scores which may have a huge impact on the pricing of mortgage rates.

HUD Requirements On FHA Streamline Mortgages

Here are the HUD Streamline Requirements
  • The homeowner needs net tangible benefit which means in order for the streamline to proceed, it needs to benefit the borrower with savings
  • The homeowner gets to skip two mortgage payments
  • The homeowner needs to have a current FHA loan that has been paid timely in the past 12 months
  • All original borrowers, including non-occupant co-borrowers, needs to be on the new FHA Loan
  • No closing costs: Closing costs can be paid by the lender with a lender credit
  • No credit score, no appraisal, and no income verification are required
  • Limited paperwork required: Tax returns, bank statements, W–2s, and paycheck stubs not required
  • Can have recent late payments with the exception of current FHA Loan
  • Closing in two to three weeks
Homeowners with current FHA loans with higher interest rates may benefit from FHA Streamline Mortgages. Please contact us at Gustan Cho Associates at 800-900-8569 or text for a faster response.  Homeowners with FHA Loans who have questions on FHA Streamline Mortgages and its benefits can also email us at gcho@gustancho.com. The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays.

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