Home loan refinancing is among of the most popular types of loans in a troubled economy. When the six o’clock news has regular gloomy updates, it’s not surprising that people turn to refinancing loans to lower their payments and improve the bottom line.
FHA Streamline Refinancing Loans can help do just that–this type of refinancing is appealing because in many cases no additional credit check is required by the FHA (though the lender may require one anyway). In some cases, the lender does not have the option to process the FHA refinancing loan with no credit check–certain situations can “trigger” the credit check requirement.
Those include any change in the mortgage term that results “in an increase in the mortgage payment of more than 20%” according to the FHA rules, as well as a situation where “deletion of a borrower or borrowers will trigger the due-on-sale clause” and where a mortgage has been assumed in certain cases.
But what does the lender need when a credit-qualifying FHA streamline loan application is submitted? What creditworthiness standards are required for Streamline Refinancing? FHA rules state, “For credit qualifying streamline refinances, the lender must…verify the borrower