FHA Streamline Mortgage Process Revised

FHA Streamline is a refinance process designed for homeowners who currently have an FHA loan. Previously, homeowners could refinance to a lower rate without an appraisal. However, after November 17, 2009, appraisals are required if clients roll any portion of the closing costs and prepaid fees into the mortgage. Clients also have to pay all points in cash with the new requirements.

The new changes to the FHA Streamline refinancing process will require homeowners to make at least six mortgage payments before they are eligible for refinancing. Homeowners interested in rolling in closing costs will need an appraisal regardless of the amount. A verbal verification of employment will also be required, along with a verification of the assets available at closing.

Traditionally, FHA loans have increased access to homeownership by offering lower down payment requirements for getting a mortgage. The credit requirements are more flexible for these loans, and the amount of documentation required is much more limited.

Homeowners looking to refinance their FHA loan should talk to their home loan expert about refinancing now in order to avoid more stringent requirements.