There are two types of Streamline Refinances, for First mortgages only.

One with an Appraisal and one without an Appraisal.

Refinance loans are serviced by a direct lender with the FHA program, so you need to meet with an approved lender and discuss the options of the Streamline Refinance loans to determine which one will be your best option.

If you have obtained your loan fairly recently, you can most likely have it set up so you can do a no out-of-pocket FHA streamline refinance into a lower rate and payment. A great thing about streamlines is you don't need an appraisal or income documentation.

Brandi & Dustin-
I don't have a resource for you to verify this but here is a basic explanation of the way that an FHA refi goes:

Original Purchase $200,000
Down Payment $7,000
Base Loan Amount $193,000
Loan w/ Up front MI $196,377.50

Now the refi (this is a streamline FHA loan without an appraisal)
Base Loan Amount $196,377.50
Loan w/ Up frontt MI $199,814.11
Up front MI from 1st FHA Loan $3,377.50

That $3,377.50 is a very important number. Based on when you closed your purchase (number of months ago), you get to credit back a portion of that fee which can be a credit on your closing costs. For instance, if the loan closed 3 months ago, you will get a credit of 76% ($2,566.90) that can be used towards paying the closing costs on the new loan. If the closing costs exceed the credit refund, then you have to come to the close with the difference.

So yes, there is a possibility that you would have an out-of-pocket cost to the refi, but we would have to calculate the numbers to know exactly. Let me know if you have any questions.

Luke Allison
Bank of America Home Loans
828-777-8828
luke.allison@bankofamerica.com