I am a direct lender here in Southern California and handle FHA loans for purchase or refinance. Many banks do not arrange FHA loans so it is no surprise that you have had some challenges locating one.
FHA streamline refinances are the simplest of any FHA loan. There is no qualifying, no appraisal, and far less paperwork in most cases. The main criteria is that you must improve (lower) your monthly payment in a beneficial amount compared to any fees charged for the new loan. This requirement is placed upon lenders to protect consumers from paying high fees for little payment reduction. Also, the borrower must be current on their mortgage payment.
Another aspect about FHA refinances to be mindful of is it is best to close your refinance loan at the end of the month. FHA receives a full month's interest on the mortgage being paid off regardless of the day of closing. Example, if you closed your new loan on the 15th of the month you would pay interest on the old loan through the end of that month in addition to being charged interest on your new loan from the day of its funding to the end of that same month.
It is important to make sure your lender of choice can close you new loan on time. If your funding does not happen until the 2nd of the month, you will double pay that entire month!
Feel free to contact me direct, if I can be of further assistance.
Wishing you all success.
Sr. Loan Officer
First Nations Home Finance
My favorite aspect of the FHA streamline program is how quickly a lender can close the loan for a potential borrower. Being that there is no appraisal and much less documentation compared to a traditional refinance, these loans generally take 2-4 weeks from start to finish.
It seems that you have plenty of information here to make a great educated decision on your homes financing, all of which are great responses. However, should you have any additional questions or concerns please don't hesitate to reach out to me at my contact information below.
Wishing you all the best,
Senior Loan Officer
From my experience with 203k loans, the best advice is to use a lender that offers assistance via third party with 203k processing.
This shortens the closing time by weeks. Try http://www.cfs-mortgage.com/203k for more information.
I work with a direct lender who has done these for my clients. One of my clients went from 6.5 down to 5.0% on a 30 year fixed. They are really pleased with this, as they bought last year and now their payment is more in line with current home sales in their area. If you want a referral, let me know. Dare to Dream.
Real Estate Consultant
RE/MAX Palos Verdes Realty
Appraisal usually not required
Very little paperwork
No credit check, income verification, employee verification, or underwriting fee
Easily increase or decrease the length of the term of your existing loan
Take advantage of current low interest rates
Little or no out-of-pocket costs
Many people choose a FHA Streamline Refinance because they can refinance with no out-of-pocket costs. This is offered in two ways: the costs can be covered by the lender in exchange for a slightly higher interest rate, or the costs can be included in the new loan if the property has sufficient equity.
FHA Streamline Requirements
There are certain requirements of a FHA Streamline Refinance. First and foremost, your existing loan must be FHA-insured, current, and in good standing. The borrower must have opened the loan at least six months prior to refinancing. The Streamline Refinance must lower the borrower's interest rate, thus lowering monthly payments. Cash back is not an option for this type of refinance
I hope this info was helpful
Wells Fargo Home Mortgage