FHA has permitted streamline refinances on insured mortgages since the early 1980s. “Streamline refinance” refers only to the amount of documentation and underwriting that the lender must perform, and does not mean that there are no costs involved in the transaction. The basic requirements of a streamline refinance are:
|The mortgage to be refinanced must already be FHA insured.|
|The mortgage to be refinanced should be current (not delinquent).|
|The refinance results in a lowering of the borrower’s monthly principal and interest payments, or, under certain circumstances, the conversion of an adjustable rate mortgage (ARM) to a fixed-rate mortgage.|
|No cash may be taken out on mortgages refinanced using the streamline refinance process.|
Lenders may offer streamline refinances in several ways. Some lenders offer “no cost” refinances (actually, no out-of-pocket expenses to the borrower) by charging a higher rate of interest on the new loan than if the borrower financed or paid the closing costs in cash. From this premium, the lender pays any closing costs that are incurred on the transaction. FHA does not allow lenders to include closing costs in the new mortgage amount of a streamline refinance. Investment properties (properties which the borrower does not occupy as his or her principal residence) may only be refinanced without an appraisal.
With rates at historic lows this could be the perfect time to save money on your mortgage payments, or even pull out some cash built up in the equity of your home. Property values have increased 35% in Las Vegas in the past 12 months. So you might be able to refinance your home today even if you were turned down a year ago.
For Las Vegas mortgage rates and home refinance options contact us