FHA Refinance Rules Changing Soon

If you currently have an FHA loan, the time is now (as in right now) to find out if refinancing can benefit you – because the rules of refinancing your FHA loan are about to get more stringent and the rules regarding the FHA streamline program are about to change.

A couple of weeks ago, there was a new announcement from HUD that outlined quite a few changes to the requirements of being able to qualify for the FHA streamline program and as a result, many people in Arizona who can refinance right now, soon won’t be able to. The new rules take effect on November 17 of this year so you only have a little bit of time left to act.

Many people in Arizona are in a situation where they currently owe more on their mortgage than their home is now worth and that is why the FHA streamline program has been a great reason to have an FHA loan — it allows you to still refinance and get a lower rate thanks to the no-appraisal requirements.

Before the new changes take effect, for anyone who wanted to do an FHA refinance streamline, it was a no-income, no asset, no credit score (although this changed for many lenders recently, not all), no appraisal program. As a result of the upcoming changes, it won’t be long before these things are really no longer true.

The new FHA streamline rules are such that soon you will pretty much need to provide all of the same information you provided when you first got your FHA loan such as income information, asset information as well as get a full appraisal because anytime you finance your closing costs (by far the most common choice when refinancing) you will now be required to get a full appraisal.

In plain English… what does this really mean?

It means if you have an FHA loan – you would be wise to act fast and refinance – before the rules change.