May 20, 2015
A reader asks, “When an applicant is applying for a refinance under the FHA Streamline and their spouse (co-borrower) has passed (died), does the remaining borrower need to show the six months of payment history before they can apply for a refinance without doing a credit qualification?”
FHA loan rules for streamline refinance loans are found in HUD 4155.1 Chapter Six. Section C has a heading titled, “Seasoning Requirement For A Streamline Refinance” which addresses this reader question. It states:
“On the date of FHA case number assignment,
–the borrower must have made at least six payments on the FHA-insured mortgage being refinanced
–at least six full months must have passed since the first payment due date of the refinanced mortgage, and
–at least 210 days must have passed from the closing date of the mortgage being refinanced”
Section C also includes the following example to help better explain these rules:
“Example : The FHA case number on the mortgage being refinanced was closed on or before December 1 st , and the borrowers first payment on that mortgage was due on January 1st. The lender may request assignment of an FHA case number for the refinancing mortgage no earlier than July 1st.”
It should be pointed out that in the case of assumed loans, the FHA seasoning requirement is different–doing a streamline refinance on a loan that was assumed and less than six months have passed since the assumption may require a credit check, and additional restrictions may apply.
Do you have questions about FHA loans? Ask us in the comments section. All questions and comments are reviewed before they will appear on the site.
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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