Here’s the deal. The government said you know what, we want to make sure it’s very easy for people to take advantage of refinancing their mortgage if rates get lower. Because normally, you’ve got to jump through a bunch of hoops. You have to provide tax returns, pay stubs, W-2s, bank statements, and all this stuff we talk about to complete a refinance loan. But the Federal Housing Administration says if you already have an FHA loan, and you’re making your payments on time, why should we stand in the way of you taking advantage of a lower interest rate?
How the FHA Streamline Refinance Works
I don’t know why all mortgages don’t work that way, but they don’t. So the idea is if your payment is going down, you can take advantage of an FHA streamline refinance without providing really any documentation. It’s a great, great program. That way, if you don’t make the same money you did, or, if you have too much debt now, or whatever has changed about your life, as long as you’re still making your FHA payment on time, you qualify for an FHA streamline refinance.
To make things better, as long as you don’t raise your loan amount, you don’t need an appraisal either. So you can refinance with no appraisal, no pay stubs, no tax returns, no W-2s, no bank statements, no nothing.
The way we make this possible at RP Funding is when you do an FHA streamline refinance with us, I pay all the closing costs for you. So there’s no money out of pocket. There’s no cost to you. So there’s no reason to raise your loan amount. So there’s no reason to get an appraisal.
Contact RP Funding to learn more about the FHA Streamline Refinance program and start saving money! Visit RPFunding.com or call 1-866-765-0765.
Why Should You Consider the FHA Streamline Refinance Program
This lets people take advantage of the FHA streamline refinance program with no appraisal, no cash out-of-pocket, no increase in loan amount, and no heavy documentation. And so we ask, well why do you streamline refinance? Well you streamline refinance to lower your interest rate. However, because the Federal Housing Administration just lowered the mortgage insurance premium as well, now you can streamline refinance to lower your mortgage insurance. So you can lower your rate and lower your mortgage insurance. This is the first time this is possible. Because previously, the mortgage insurance was very high. Now it’s lower.
So, you can streamline refinance currently and lower your interest rate and lower your mortgage insurance premium, which means you get to save in two ways. And again, because I’m paying all the closing costs, I pay everything except for the mortgage insurance premium, the customer’s responsible for themselves. That gets financed right into the loan, the new mortgage insurance premium, and in some cases, FHA gives you a credit back from your old mortgage insurance premium.
There’s A Lot of Ways to Save with FHA Streamline Refinance
Some of that money you paid on the first closing for the mortgage insurance premium can be credited back against the new mortgage insurance premium. So there’s a lot of ways to save here. But, even if you’re only dropping your rate a half percent or a quarter percent because you’re also dropping the mortgage insurance, it doubles the savings.
We’ve actually had some customers where it made sense for them to refinance, keeping the interest rate the exact same, but they’re dropping the mortgage insurance enough that the savings is there.
With no extra closing costs up front, just the upfront mortgage insurance, it’s almost all savings. So this is definitely something important to look at. It’s a unique program and there’s no credit qualifying required.
Requirements for FHA Streamline Refinance
Now when you say, making their payments on time, what if they ran into some bumpy roads back during the bust? Is there any kind of a time frame on this making it on time?
Yes. So we really want to see 12 months of on time payments. We’re willing to consider as little as six months of on-time payments, but we really want to see 12. Because, again, the idea is we don’t want to take over a mortgage for someone who’s in trouble. We don’t want to refinance your mortgage away from your current bank and refinance it over here at RP Funding giving you the lower rate if you’re in trouble if you’re struggling to make that payment. So, we want to refinance loans that are performing. Loans that are doing well, where the people are paying on time.
So as long as you’ve had the loan for six months. That’s the other caveat. You can’t refinance on a streamline until you’ve made six payments, and those six payments will need to have been on time. Then if you’ve had your loan longer than a year, we’re going to look for 12 months of on time payments. But, we can grant some exceptions for lower. But again, this is to reward people who have made their payments on time with a lower mortgage insurance premium factor monthly, and in a lot of cases a lower interest rate as well.
How to Begin the Process of FHA Streamline Refinance
Here’s the key.
First of all, you have to have an FHA mortgage to start with. So your existing loan has to be FHA. About 30% of the mortgages that were made over the last couple years were FHA. So one in three people currently has an FHA loan.
Number two, you need to have had that FHA loan for at least six months. And you do make those payments on time like we talked about. So from there, you can give us a call. If you can tell us what your current interest rate is then we can calculate the savings for you.
We can figure out what your current mortgage insurance premium is because we can tell based on when you got your mortgage. And so from there, it’s a really easy process. It doesn’t have to go through underwriting and processing like a normal refinance does. These are very easy to get closed. It’s the easiest loan you’ll ever get. And it’s the easiest loan I’ll ever give you, because the FHA streamline refinance has no credit qualifying.
Want More Information?
If you’re interested in learning more about the FHA Streamline Refinance program or FHA loans in general, visit RPFunding.com or call 1-866-765-0765.