If you currently have an FHA or VA mortgage loan, then you can streamline refinance your mortgage with no income verification and no appraisal. Only an FHA and VA loan is available for a streamline refinance mortgage.
What Is An FHA and VA Streamline Refinance Mortgage
A streamline refinance is a fast-track refinance loan program with limited documentation with no home appraisal required. If you have an FHA or VA loan at a high rate, the probability you will be tasked one day with having to refinance your mortgage is most likely.
Streamline Refinance Requires Limited Docs and No Income Verification
If you have an FHA or VA loan, odds are there is a Streamline Refinance available for you that you are not taking advantage of. This article will look into all things Streamline Refinance has to offer. We will discuss and cover how easy an FHA and VA streamline refinance is.
Understanding How Easy and Fast a Streamline Refinance Mortgage Is
We will put all your different loan scenarios in one place giving you a go-to resource to get the information needed to start a streamline refinance. Once you are armed with the information you desire, you are then only a phone call away from taking advantage of some great efficient programs to get you refinanced right away.
The Benefits of No-Income Verification Requirement on Streamline Refinance
The main characteristic behind all Streamline Refinance loans is the fact that these loans are “no-doc” or “minimal doc” loans. No-doc mortgages mean the lender will not verify employment or income. With streamline refinance mortgages, you will not need to put together all the paperwork and documents that you had to when purchasing your home.
Fast-Track Refinance Which Can Close In Two Weeks
You will even be able to refinance your loan without even ordering an appraisal to check the value of your home. If there was ever a time for quick and easy refinances, it is right now as more and more products are introduced to make this happen. In its simplest form, a mortgage streamline refinance is just what it appears to be from its name. A fast-track refinance mortgage loan program financing a new lower interest rate loan in order to take place of an existing higher rate loan.
Reason To Streamline Refinance Your Current Mortgage
Homeowners can streamline refinance to lower their monthly mortgage payments, save mortgage interest expenses, and save tens of thousands of dollars over the course of the loan term. You can only do a rate and term on streamline refinance. All original borrowers and co-borrowers on the loan need to be on the new streamlined refinance loan.
Other Mortgage Refinance Loan Programs
With home prices at all-time historic highs with no signs of any housing correction, many homeowners are looking into cash-out refinance mortgages. Cash-out refinance is when homeowners take advantage of their home equity and refinance in order to take cash out of their property. This can only be done if homeowners have the equity to support this. Cash-out refinances loan options include FHA, VA, and Conventional loans. Full documentation and a new appraisal are required on cash-out refinances.
Reasons For Cash-Out Refinance
Cash-out refinance mortgages are common for homeowners who want to do repairs and renovations on their homes. Without a cash-out refinance mortgage, homeowners would not have sufficient cash otherwise. Proceeds from cash-out refinance mortgages are tax-free. You do not have to pay taxes on the amount of cash-out proceeds no matter how large the amount is.
Full-Doc Rate and Term Refinance
There are reasons why homeowners need to do full-doc rate and term refinances versus streamline refinance mortgages. Many homeowners with non-occupant co-borrowers may want to relieve the non-occupant co-borrower of their liability as co-borrowers. You would need full doc rate and term refinance with a new home appraisal..
Refinancing Reduces Mortgage Rates and Lower Housing Payments
Refinance to lower your rate is probably one of the most popular forms of refinancing. This is exactly what it says it is in the fact that you will take advantage of lower interest rates than the one you currently have. Refinance to reduce your rate and save tens of thousands of dollars over the course of the loan term. You can also refinance to a shorter amortized loan term from 30 years to 15 years.
FHA Streamline Refinance
It is only fitting that the first Streamline Refinance we look at is the FHA Streamline. FHA loans are the most popular loans due to the lax lending guidelines from HUD. As the name says, this Streamline Refinance is for those borrowers currently holding FHA loans.
FHA Streamline Refinance Requirements
There are just a few requirements that are needed in order to go through an FHA streamline refinance mortgage. The homeowner needs A Net Tangible Benefit. What net tangible benefit mean is homeowners must have a positive benefit from refinancing. Homeowners must gain from the refinance whether it be a reduced payment amount or a shorter loan term. Your original FHA Loan must be at least 210 days or 7 months old prior to going through with an FHA Streamline. You must be free of any late payments within the last 3 months or 90 days prior to the FHA Streamline. After these requirements, there are only a few more items that you need to know, Some of the best rules are that your income and employment are not verified, This is because they will use the original qualification on your FHA Loan.
Streamline Refinance: HARP (Conventional Loans)
If you are one of those with a loan that is backed by Fannie Mae or Freddie Mac which are known as your Conventional or Conforming Loans, then the HARP or Home Affordable Refinance Program is the program was available. HARP loans are no longer available. It has been discontinued years ago. If you haven’t read my past article with regards to HARP, you can find it here. HARP as we know is no longer available.
The Now Defunct HARP Mortgage Refinance Loan Program
Although HARP is no longer available, we are updating the HARP guidelines for informational purposes. The basic guidelines for HARP were the following:
- You must have been current at the time of the refinance with no previous late payments
- in recent history, you could not have any late payments in the previous year or 12 months.
- Your original mortgage needs to have been owned by Fannie Mae and/or Freddie Mac and must have been closed prior to June 1, 2009.
- With a HARP Streamline Refinance, there is not a cap on your LTV or loan to value ratio.
- This is due to the fact this program was designed for people who have underwater mortgages where you owe more than the home is worth.
- This was the case for a lot of borrowers during the Great Recession where home values sunk leaving most borrowers in this predicament.
As with other Streamline Refinance options, HARP did not require a home appraisal or verification of employment or income.
VA IRRRL Refinance Mortgages
The last loan we are going to look into is the VA IRRRL Streamline Refinance option available for VA Loans. VA doesn’t consider this a Streamline Refinance but rather an Interest Rate Reduction Refinance Loan or IRRRL for short.
VA IRRRL Guidelines
Just as in the previous streamline refinance mortgage options, there are really only a few main guidelines that you are going to need to follow in order to take advantage of this loan and its benefits.
- You must have a Net Tangible Benefit with the VA refinance
- Borrowers must show that your payment is reducing or you will not be able to get approved for this program.
- This must be the primary residence that you are currently residing in.
- You also cannot have more than 1 late payment on your mortgage in the past year or 12 months.
As with all the previous Streamline Refinance options out there, there is not a requirement for an appraisal, income, or even verification of employment. As you can see, this is an extremely painless option for those with VA Loans to partake in.
Streamline Refinance Is Easiest Mortgage Options For Homeowners
As long as you are wanting to stay in the same loan program that you are currently in then a Streamline Refinance is your best bet for refinancing with minimal documents required. The basic understanding of these programs is if you qualified for a mortgage in the first place, then there isn’t a reason you shouldn’t be able to refinance especially if you are reducing your monthly mortgage payment and making it more affordable. Most programs you come into contact with don’t want to see recent late payments because no late payments show that you are still making the payment as agreed and there is no further worry with this. If you are curious about going through a Streamline Refinance, please contact us at Loan Consultants at 844-275-2007. Text us for a faster response. The team at Loan Consultants looks forward to hearing from you 7 days a week, evenings, weekends, and holidays.