FHA will require verification of employment, but not income verification. No tax returns, W-2's or paystubs required. Also, a credit report is not required.
An appraisal is required only if the borrower is rolling the closing costs into the loan. If the borrower decides on a No-Cost streamline refinance which is available, or pays the closing costs out of pocket, then no appraisal is required. If the borrower decides to roll the closing costs into the loan, an appraisal is required and there are maximum Loan to Value requirements on the new loan.
If you have a 2nd Trust Deed on your property and you are not paying that loan off with your refinance, the current lender on the 2nd Trust Deed must agree to subordinate to the new first FHA loan.
This Streamline Refinance FHA loan is perfect for the borrower that is in good standing on their current loan, but has a high interest rate and would like to refinance to lower their payment. FHA's streamline refinance allows borrowers to refinance their current mortgage with less documentation than a regular refinance loan. Since an appraisal is not required in most cases, this is an excellent loan for borrowers that do not have a lot of equity. It's also a great loan for people who pay their mortgage on time but don't have good credit otherwise.
Patricia Barmatz has been in the mortgage business for the past 24 years. If you would like more information about this Streamline FHA or other mortgage loan, please visit me at http://fha.yourmtglender.com or call me at 818-920-1600.
