If you already have an FHA or VA loan, you may be able to refinance with less paperwork, often no appraisal, and lower costs through the government's own streamline programs.
FHA Streamline Refinance
- For homeowners with an existing FHA loan who want a lower rate or to move from an adjustable to a fixed rate.
- No appraisal is required for the non-credit-qualifying version, so a drop in home value does not stop it.
- The new loan must produce a net tangible benefit, usually a meaningful reduction in rate and payment, under FHA's rules.
- You must be current on your mortgage with a good recent payment history, and the loan must be seasoned at least 210 days with six payments made.
- Closing costs cannot be rolled into the loan on a Streamline, but may be covered by a lender credit in exchange for a slightly higher rate.
- Upfront mortgage insurance applies again, with a partial refund of the original premium if you refinance within three years.
VA Interest Rate Reduction Refinance Loan (IRRRL)
- For homeowners with an existing VA loan, to lower the rate or convert an ARM to a fixed rate.
- No appraisal and no income verification are required in most cases.
- The VA funding fee is reduced to 0.5%, and is waived for borrowers with a service-connected disability rating.
- Closing costs can be included in the loan.
- Rules on seasoning, recoupment of costs and the required rate reduction apply; we check them against your loan before you apply.
What a streamline cannot do
Neither program lets you take cash out beyond minor amounts, add or remove a borrower in most cases, or move to a different loan type. For those, see standard refinancing or cash-out refinancing.
Is it worth it?
Divide the cost of the refinance by the monthly savings for the break-even in months. If you will keep the home longer than that, it usually makes sense. We run the numbers for you and show the result before you commit to anything.