I’m in the middle of doing FHA’s Streamline refi on my house because rates are about a point lower now than when I first bought the house. My mortgage guy tells me that FHA just changed their lending standards and are now requiring lenders to pull credit, tax returns, pay stubs, etc. whereas they didn’t before for the Streamline. Can any of you mortgage pros confirm these FHA changes?
None of that to my knowledge is in place yet. Streamline changes are occurring but I am doing one right now and all we require is a 12 month pay history a copy of the note and a copy of the last HUD1
Jake,
Your mortgage professional is partly correct. FHA has not changed their guidelines. The investors that are buying the loans on the secondary market and servicing the loans have put guideline overlays in place. These overlays are what your mortgage professional is referring to. The reason for this is because lenders are saying that these streamline refinances are performing badly and they want to verify that the borrowers are not poor credit risks. The credit score for most FHA lenders is now a 620. The copy of the HUD 1 and the Note are standard requests. they need them for the original loan amount and the FHA case#. Hope this helps.
Thanks- I do recall my LO saying something about the investors changing their standards, so maybe I just phrased my original question incorrectly, but now it all makes sense.