FHA Streamline changes

FHA has changed their guidelines effective with case numbers assigned on or after 11/18/09. Some of the major changes are:

• Seasoning Requirements – the borrower must have made at least 6 payments on the FHA-insured mortgage being refinanced

• Lender must determine there is a net tangible benefit as a result of the streamline (details are on the worksheet)

• Lender must certify that the borrower is employed and has income (income amount does not need to be verified)

• Funds to close must now be documented

• Lender must enter the credit score into FHA Connection

• Loan amount calculations have changed. You can no longer include closing costs and prepaids for the new loan on a Streamline Refinance WITHOUT an Appraisal. You can include closing costs and prepaids for the new loan on a Streamline Refinance WITH an Appraisal. However, you cannot include discount points

The changes were announced with Mortgagee Letter 2009-32.

Shirley Nault has been a mortgage professional for over 20 years. Visit her other mortgage web sites go to www.mtgview.blogspot.com or www.dutips.blogspot.com