subject: How to Get an FHA Streamline Loan [print this page] How to Get an FHA Streamline Loan How to Get an FHA Streamline Loan
You have heard about the FHA streamline loan, were you wondering how to go about getting this type of loan? This loan is a refinance and its really not that hard to get. Certain requirements have to be met first. Let's see what those requirements are and then how to go about it.
Those requirements for the FHA streamline loan basically are:
You must already have an FHA insured mortgage. Since the FHA streamline loan is a refinance product, you would have to have a mortgage in order to refinance it. And it must be a mortgage that is already insured by the FHA.
You cannot be delinquent on your mortgage.
The refinance should lower your interest and your monthly principle otherwise there is no sense in refinancing the original mortgage.
If you meet the above requirements you are ready to start the FHA streamline loan process. Here's what you do to get started:
Contact an FHA approved lender.
Since interest rates are set by the lenders, shop to make sure you have the best rate.
Fill out and complete a loan application.
Provide whatever documentation they may need to get the process going.
But before you make that final decision you need to count the cost of refinancing. There will be costs such as an appraisal and closing costs. If the savings are not high enough, it will not be worth it to pay these costs simply to lower your interest rate or payments.
It is possible to include the closing costs into your new mortgage but you will need two factors for this to be possible:
You must have enough equity in the home to allow for this
You will need an appraisal to confirm there is enough equity
With today's economy, we all would like to lower our monthly payments! That is why you should consider the FHA streamline loan if you are considering a refinance of your original FHA mortgage.
Another reason this type of loan is effective is it doesn't require a credit check or income verification. They take into account since you have already qualified for your original FHA mortgage you are already a good candidate. Debt to income ratio doesn't have to be a consideration, unless you want to see how your doing in this area.
The FHA streamline loan is not the same as those cash-out refinance programs. The benefit you are looking for is not cash but having your monthly payments permanently lowered. In the long run you will get extra money in your pocket each month with a lower payment. So it still accomplishes your financial goals!
Perhaps you have a conventional loan you want to refinance, should you not even think about it? No, you can consider it, you will need to follow the usual application process with employment verification, credit screening, and other requirements to qualify. You just will have to go through the qualification process to get an FHA mortgage. The streamline process is for those of you who already have an FHA mortgage.
All in all when you can get a loan with a lower interest rate or better terms, then why wait? Get the FHA streamline loan process started and save money!
