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Can I get a streamline FHA refinance to switch from a 30-year to a 15-year mortgage?

by CSantana from Addison, Texas. Jan 29th 2013 Reply


Steven Ceceri (123LoanYes)
#12 ranked lender in Rhode Island - 723 contributions

Good Evening.. It seems I will be the only one to say NO to your question! I would encourage you to apply to any lender for your Streamline Refinance as you can't use a Streamline to reduce your term from 30 to 15 Years. This type of term reduction does not meet the requirement under HUD's Net Tangible Benefit Definition. I would see if anyone on this post has actually completed a true Streamline Refinance and not just a Traditional Refinance under this rate reduction theory! I am open to learning something new everyday, but based on the documented facts, this is not eligible for the Streamline Refinance by Definition. I'd be happy to assist you in more detail if you'd like, but either way, I wish you well!

Jan 29th 2013
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Peter Botros (PeterBotros)
#70 ranked lender in New York - 895 contributions

I hate to disagree with some of my colleagues in this forum, however, the 20% increase rule is gone. In order for you to streamline from a 30 to a 15 you must meet 1 of 2 criteria. 1. If your Principal and Interest + Mortgage Insurance is at least 5% less than your current PI + MI. or 2. You fully credit qualify, and your income can support the new payment, regardless of percentage increase in payment.

Jan 29th 2013
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William J Acres (William_Acres)
#73 ranked lender in Arizona - 8,728 contributions

You can if your current loan is FHA. If you are saving at least 5% in your monthly payment, then no problems.. if you're not saving 5%, then you can still do the streamline, but you will have to prove you can afford the payment, so they will require pay stubs, tax returns, and w2's.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Jan 29th 2013
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John Schweer (johnschweer)
#9 ranked lender in Missouri - 163 contributions

If the only benefit is shortened term then the streamlined product is not available, if there is a payment reduction then yes you can... however that doesn't mean you cant use the FHA for the refinance... that being said, why do you want the streamline product? unless its to avoid an appraisal then more than likely there will be other 15 year programs that will fit your personal needs better. I have been doing FHA streamlines since 1998 as well as VA IRRRL the veteran equivalent..... reach out to me if you'd like to discuss your situation with no obligation or expectation on my part. Oh by the way I have been certified by the state of Texas for the last 4 years now so im very familiar with the Texas mortgage laws.thanksJohndirect line 816-412-3568

Jan 31st 2013
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Brad Cahoone (info@globalhomefinance.com)
#89 ranked lender in Texas - 1,042 contributions

Yes but not all lenders will allow it as they want your payment to go down 5%. Call me to go over this. There is more to it. FHA has credit qualifying and non-credit qualifying streamlines now. Brad Cahoone- 972-724-3222 ext227 - bcahoone@globalhomefinance.com

Jan 29th 2013
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Josh Lund (Josh_Lund)
#45 ranked lender in Minnesota - 113 contributions

You are allowed to switch to a 15 year term from your current 30 year term, as long as your principal, interest, and mortgage insurance payment does not increase by more than 20%.

Jan 29th 2013
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Joe Shamie (Joe Shamie)
#4 ranked lender in New Jersey - 1,412 contributions

As long as you INCOME can support the higher payment in your debt ratio calcualtion, you CAN streamline from a 30 to a 15 with NO LIMITATIONS on how much you monthly payment increases.

Jan 29th 2013
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Michelle Curtis Loan Originator NMLS 401173 (MichelleCurtisLO)
#77 ranked lender in Florida - 2,245 contributions

Yes you can as long as all other parameters are met. Your payment can not increase more than 20%

Jan 29th 2013
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William Crawford (AspireLending)
#70 ranked lender in Texas - 6 contributions

My best guess is that this question stems from being told different things by different lenders that you ask the question too. Let me kind of give you a little bit of insight as to why this is happening.To be clear, FHA does not have any prohibition from using the streamline refinance program to reduce short-term from 30 years to 15 years. And yes, I would like to echo what Josh has told you, according to FHA guidelines the only stipulation in this regard is that your payment cannot increase by more than 20%.Here is the rub however . . . In our industry we constantly have to manage what we refer to as "underwriting overlays". These are underwriting restrictions done at the specific lender level that may be more restrictive than what FHA guidelines are. One of the tasks that all lenders must perform in doing any kind of refinance for a customer is to be able to demonstrate that the refinance is providing a benefit to you, the borrower. Unfortunately, some lenders have taken the very narrow stance on FHA loans that unless the monthly payment is going down there is no benefit. I, as I believe you would also, disagree. Certainly reducing your term and being able to leverage the lower interest rates to assist in the accelerated payoff of your loan is in fact a benefit.Here at Aspire Lending, we are Mortgage Bankers, meaning that we have a multitude of different lenders that we originate and underwrite our loans for. While a majority of our lenders do in fact have this "underwriting overlay", we have few that do not.But at the end of the day, should you decide that Aspire Lending can be of assistance to you, coordinating the proper investor to place your loan with is something that you will not have to concern yourself with. All of my customers deal with the directly, we take the application over the phone in less than 10 minutes, provide you with a short list of documentation needed to process your streamlined refinance request, enclosed approximately 14 days.My name is William Crawford, and I am the Branch Manager of the Aspire Lending branch in Southlake Texas. I would be happy to help you personally with this. Please contact my office at 817-203-2200 and ask to speak with me directly.

Jan 29th 2013
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Jason Vondrak (jvondrak)
#221 ranked lender in California - 1,741 contributions

Yes, you can refinance from a 30-year to a 15-year loan using the FHA streamline refinance program. You want to make sure that you are able to afford the higher monthly payments that will come along with a 15-year loan since you are cutting the life of the loan in half. As long as you can afford the higher monthly payments, a 15-year loan will save you thousands in interest over the life of the loan.

Jan 29th 2013
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Ryan Romero (REFIryan)
#456 ranked lender in California - 27 contributions

If you have money buy down the balance and go conventional ... FHA is basically a sub prime loan pumped up by the government. Get out of it or stay put ... You still have pay the up front mortgage insurance and the monthly www.rmfundinggroup.com 619 884 9116 888 308 7775 Ryan

Jan 29th 2013
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Steve Azarch (sazarch)
#18 ranked lender in Tennessee - 93 contributions

You should be able to if you can save at least 5% over your current mortgage payment and meet all the other FHA guidelines.

Jan 29th 2013
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Andrew Alfonso (CashCow)
#43 ranked lender in Florida - 271 contributions

Yes but not all lenders will allow it as they want your payment to go down 5%. Call me to go over this. There is more to it. FHA has credit qualifying and non-credit qualifying streamlines now. Andrew Alfonso

Jan 29th 2013
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Equitus Mortgage (EquitusMortgage)
#65 ranked lender in Washington - 39 contributions

If your can meet the net tangible benefit of 5% from current payment you can go from a 30 year to a 15 year. FHA does offer a 20 year which we use often to shorten term and reduce payment.

Jan 29th 2013
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