Rates have been on a steady hike after the historic US elections but Freddie Mac’s PMMS®results last week could just be the right signal for homebuyers and refinancers to lock in on rates. Not that it’s really necessary. With today’s record-low rates, and borrower-friendly mortgage programs, there are very few reasons why you could not own a home.
If you are planning to refinance, there are various “streamlined” programs that could make your refinancing simple and easy. This article aims to help you find the best streamline refi that could just be the answer to your refi needs.
Refinancing Basics
Refinancing is, in a nutshell, a remortgage. You take out a new loan to satisfy the terms of the old one.
There are various reasons why a homeowner refinances:
- to extend or shorten the term of the loan
- to avail of new, lower interest rates (as what is on season now)
- to cash out on their home’s equity
Types of Streamlined Refinances
Streamlined refinances differ by the agency that backs them. These types of refinances are “streamlined” because they offer more convenience to the borrower through guidelines that are less stringent than that of conventional refi programs. Today’s millions of American homeowners can take advantage of the following streamlined refi programs:
HARP
HARP, or Home Affordable Refinance Program is backed by mortgage giants Fannie Mae and Freddie Mac. When you refinance under this program, there is no limit in LTV on fixed rate mortgages. There is, as well, no need for your income to be verified, nor your credit be pulled out, or your employment history to be scrutinized.
To be eligible for HARP, you must:
- have a current mortgage with a note date not later than May 31, 2009
- not have more than one delinquent payment on your home loan for the past year
HARP, however, will not be available after September 30, 2017. Talk of a replacement is there, but no certainty can be said as of now.
VA Streamline Refinance
For modern American heroes, refinancing is made easier with the VA Streamline Refinance. VA Streamline Refi loans are backed by the US Veterans Affairs Department. In order to qualify for a VA home loan refi, you must satisfy the following requirements:
- you must have a current mortgage
- your mortgage must be reduced by the refi, except for ARM-to-FRM refis
- you must not have more than one delinquent payment on your home loan for the past year
There is no need for income, asset, credit, or employment verification with a VA Streamline Refinance either. Home appraisals, moreover, are not required. You are also not required to pay for mortgage insurance under this program.
FHA Streamline Refinance
If you have a mortgage currently under the Federal Housing Administration (FHA), you could be eligible for an FHA Streamline Refinance. Other eligibility requirements include:
- your property must be at least 210 days old
- your refi must have a Net Tangible Benefit
- you must not have a delinquent payment history within the past three (3) months
Through the FHA streamline refinance, you may have the power to waive off your appraisal. This is on top of no credit, income, or employment verification requirements.
If your mortgage was endorsed on or prior to May 31, 2009, you can be eligible for a special, reduced, FHA mortgage insurance rates. You can use an FHA Streamline Refinance to fund primary homes, vacation homes, as well as investment properties.
USDA Streamline Refinance
The US Department of Agriculture has the USDA Streamline Refi program available for eligible borrowers in the following states:
- Alabama
- Alaska
- Arizona
- Arkansas
- California
- Colorado
- Florida
- Georgia
- Idaho
- Illinois
- Indiana
- Kansas
- Kentucky
- Michigan
- Mississippi
- Missouri
- Montana
- Nevada
- New Jersey
- New Mexico
- North Carolina
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Rhode Island
- South Carolina
- South Dakota
- Tennessee
- Texas
- Utah
- Washington
- West Virginia
- Wisconsin
To be qualified, you must:
- have the property as your primary residence
- live in one of the aforementioned states
- not have more than one delinquent payment on your home loan for the past year
Like the other streamline refi programs, there is no income, credit, asset, or employment verifications required.
Streamline refi programs are the most advantageous programs for borrowers with underwater mortgages. Because it would be difficult for you to refi under conventional standards given your mortgage’s condition, the less stringent guidelines of these streamlined programs offer you the perfect conditions through which to save your home loan situation. Other than that, you get to waive the processes that usually cause mortgage delays, thus allowing you to close sooner.
If you are planning to refinance and feel like you are an eligible candidate for one of these programs, pair up with the right people today to get your refi process swinging in no time.
