No Credit Score Requirements On Streamlines
- The new mortgage balance is restricted as follows:
- Principal Mortgage Balance plus Upfront FHA MIP
- Other closing costs such as pre-paid, title charges, transfer stamps, legal fees, homeowners insurance, recording charges, and other costs/fees either needs to be paid by the borrower or credited by the lender via a lender credit
- All closing costs are credited by lender credit by refinance lenders
- Borrowers can normally skip one or two mortgage payments on FHA Streamlines
Borrowers may be entitled to partial refunds on their upfront FHA mortgage insurance premium when they do a streamline refinance.
HUD Guidelines On FHA Streamline And Role Of FHA
The Federal Housing Administration is like a private mortgage insurance company. HUD is the parent of FHA and we will be discussing and covering the role of HUD and FHA in this article. HUD’s role is to promote homeownership to hard-working Americans. FHA is not a lender but a government mortgage insurance agency. It insures FHA Loans that are originated by private mortgage companies if borrowers default on their FHA-insured mortgage loans. FHA is the most popular mortgage loan program today with low credit and debt to income ratio requirements.
Can I Qualify For FHA Loans with Outstanding Collections and Charged-Off Accounts?
Homebuyers and refinance borrowers do not have to pay outstanding collections and charge off accounts to qualify for FHA loans. Homebuyers can qualify for FHA Loans with a 3.5% down payment. Homebuyers with credit scores under 580 and down to a 500 FICO can qualify for an FHA loan with a 10% down payment.
HUD Guidelines On FHA Streamline With Lower Credit Scores
To qualify for a 3.5% down payment FHA mortgage, 580 FICO credit scores are required. Homebuyers with under 580 FICO need 10% down payment and refinance borrowers need 90% Loan To Value. HUD allows up to 46.9% front-end DTI and 56.9% back-end DTI on borrowers with at least 620 credit scores. Under 620 FICO, the maximum allowable DTI is 43%.
FHA Loans After Chapter 13 Bankruptcy Discharged Date
No Waiting Period After Chapter 13 Bankruptcy Discharged Date. Borrowers can qualify for FHA Loan one year into a Chapter 13 Bankruptcy repayment plan with Trustee Approval. Two year waiting period after Chapter 7 Bankruptcy discharged date. Three year waiting period after foreclosure, deed in lieu of foreclosure, and short sale
Using Non-QM Loans as an Alternative to FHA Loans
Non-QM Loans available for borrowers who do not meet the waiting period after bankruptcy and foreclosure. No waiting period after bankruptcy and foreclosure with non-QM loans.
Qualifying For FHA Streamline Refinance
If you have a current FHA Loan and want to see how much money you can save with an FHA Streamline Refinance, contact us at Gustan Cho Associates at 262-716-8151 or text us for a faster response. Or email us [email protected] Remember that homeowners can skip one to two month’s mortgage payments and save on their monthly mortgage payments with a streamline refinance. Plus, we cover all of the closing costs with a lender credit.