February 4, 2015
We get many questions about FHA home loans. Some of them come in the form of detailed queries about specifics of a certain FHA loan program, others come as more general questions about the nature or scope of FHA home loans. Here’s one of the more generalized questions that came in recently. A reader asks:
“What about help with a current FHA loan? Remodification?”
It’s not clear what the reader is getting at with this question, but assuming the reader wants assistance with an existing FHA loan in order to get into a lower monthly payment, the good news is that there is definitely assistance available in the form of FHA Streamline Refinancing.
FHA Streamline refinance loans are for borrowers with existing FHA mortgages who want a lower interest rate, monthly payment, or both. The FHA Streamline Refinance loan features no FHA-required credit check, no FHA-required appraisal, and the lender is free to use the borrower’s existing appraisal and credit information from the original home loan to process the new Streamline refi.
FHA Streamline loans have a general requirement that some “tangible benefit” for the borrower must be the result of the new loan. That benefit can be the lower rates we mentioned, the lower payment, but it can also be in the form of a fixed interest rate in cases where the borrower wants to refinance out of an Adjustable Rate Mortgage loan.
The fixed rate may not be lower than the borrower’s current rate, but moving into a fixed rate FHA mortgage loan is viewed as a tangible benefit and that makes it an acceptable use of FHA Streamline Refinancing.
Talk to your lender about your FHA Streamline Refinance loan options today–you may be surprised at what you learn about your options.
Do you have questions about FHA home loans? Ask us in the comments section.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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