If you look for the faster way to refinance the loan, you should consider a streamlined loan. The lenders use the original documentation to refinance the home loan in a few weeks instead of a few months. Sometimes, the borrowers qualify for the substantially lower rates, get rid of the adjustable rate mortgage or graduated payment mortgage.
You don’t have to provide the appraisal. You can find information that some lenders don’t require an income proof, credit check, or employment verification. Still, you should be ready to provide this information.
Requirements for Applying for a Streamlined Loan
There are some requirements for people applying for a streamlined loan. The main requirement says that you are only allowed to have one missed payment in 12 months. The rest of the payments have to be on time.
Speaking of the FHA streamlined loan, it requires borrowers to have all three last payments on time.
In fact, there are no common rules for FHA or VA streamlined loan. Every FHA or VA lender might fix the requirements. So, if you are underwater of your mortgage, have a bad credit, or are currently unemployed, check out the requirements for such cases beforehand.
The main reasons for applying for a streamlined FHA loan or a VA loan are reducing the mortgage rate and reducing the monthly payments. These types of the streamlined loans sometimes replace an ARM with a fixed rate.
In fact, the VA and FHA streamline refinance rates are almost the same that you would pay on the simple VA or FHA loans.The closing costs are similar to the common refinance. Still, you don’t pay for a credit report or appraisal if you give up.
Related for veterans:
Read about loans for veterans options online.