Government Sponsored Interest Rate Reduction
The FHA Streamline Refinance (without appraisal)
allows you to lower your interest rate and in many cases I can pay closing costs for you.
This loan is only available to existing FHA customers but I can pay costs on large Fannie Mae/Freddie Mac loans as well.
It is a great loan because it provides what every mortgage customer wants
(Free = I can adjust the rate and pay costs for you. In some cases all of the costs by taking rebate from the source and paying closing costs with it)
Every borrower who currently has an FHA loan should periodically take a look at the possibility of doing and FHA Streamline Refinance. Even if we are only lowering the rate a little, there is still a substantial benefit to the customer due to reduced costs and in some cases no costs! If you have any doubts, please call to make sure.
(There is no cash out or debt consolidation with this loan)
The FHA Streamline Refinance is ideal for existing FHA Customers who want:
- No Appraisal * (O.k for customers who are upside down on value)
- No Income verification ( just proof of work history)
- No credit report except for mortgage history (minimum 640 middle score)
- Skip a month's payment
- Old escrow money comes back
- In some cases a free loan*
- It has to be a rate/term refinance
- If you have a second mortgage, we need to show no large draws within the last year
*This loan can help customers who are upside down on the value of their property because there is no appraisal requirement. We need to check what FHA will allow you to borrow based on your previous FHA case file #. It has to be less. that is the only criterea.
** Many customers ask how I can have a free loan. This is done by taking the yield spread premium also known as service release premium paid by the lender to the broker and applying it to your closing costs. Similiarly, I can price any loan with points, with no points or where I pay costs for you. First South Mortgage has their own warehouse lines so we get the best pricing.
(We can roll them in so you don't write a check)
Here is an article that I wrote for Huliq.com regarding the FHA Streamline refinance:
The Streamline FHA Refinance - http://www.huliq.com/1/86552/many-buyers-dont-get-no-closing-cost-mortgage
Providing service in the mortgage business means ensuring a smooth and easy process and providing “absolute red carpet treatment” for the customer. Half of the mortgage person’s job is finding the customer through marketing and the other half is guiding them through the loan process hopefully making for a happy experience. We are always looking for ways to make the process of getting a mortgage easier because ultimately that will reflect positively on us and hopefully lead to more business. Today, I thought it would be a good idea to talk about a loan program that is truly a smooth and easy program and is still available in today’s mortgage world. This program is the Streamline FHA refinance without an appraisal.
The streamline FHA refinance without an appraisal is when we refinance an existing FHA customer and place them back into a new FHA loan. Even if the borrower is only taking their interest rate down 1%, a smart borrower should consider this loan because there are a few less closing costs associated with this loan. The streamline refinance is relatively easy because there is less documentation than your typical FHA loan. We still have a lot of paperwork but there is no appraisal, no proof of income, no proof of assets and no credit report. The application still has to reflect correct names and dates of employment as well as the details of the transaction.
There are a few key ingredients necessary for a streamline FHA refinance. The new mortgage has to less of a loan amount than the old mortgage. The mortgage history has to be paid on time and there is no cash out to the borrowers at closing. This loan allows for the loan officer to pay closing costs if the cash to close is tight. He or she can structure the transaction a little differently to make it work for the borrower’s bottom line. For example, if the prevailing FHA interest rate is 5%, the loan officer can provide 5.25% and pay $1500 in closing costs to help the borrower avoid writing a check at closing. Just like the way we can look at a no closing cost loan in the conventional world, the loan officer can pay closing costs to make the break-even point less.
The FHA streamline refinance helps customers who may be upside down on their home value still improve their situation because there is no appraisal requirement. So customers who have been sitting on the fence with rates in the sixes should look at this loan opportunity. As long as the new loan amount is less than the old loan amount, the payment drops by at least $50, and the FHA customer has a good mortgage history, we can do this loan.
Written by Preston Ware
Email is firstname.lastname@example.org.