Posted by QuickReadAbout.com Staff in With technology today and a streamlining process of formulating refinancing loans, there is the ability to get a home loan refinanced online, rather than having to go into the lender to get the paperwork accomplished. This makes the process much easier on the consumer and the lender alike, reducing the length of time the process takes and giving the homeowner an answer very quickly.
Home loan refinancing online can only be accomplished when the loan is a streamlined loan, meaning that the only qualifications needed is to show that the person already is in good standing with their FHA loan and that a refinancing would give them a better interest rate, or will fix the interest rate that they have with their adjustable mortgage rate loan. This is different from a bad credit home loan mortgage refinance in which the homeowner needs money to cover bad debt and thus wants to refinance a larger amount and pull out their equity.
Cautions
When choosing to do a home loan refinance online, it is important to make sure that the lender is doing an FHA streamlined refinance. These lenders will mostly subscribe to the rules that the FHA has put in place to protect the homeowner from unscrupulous practices by lenders. Although it is not complete protection, it is at least a good safeguard to have in place. In addition, the website should say that it is protected so that there is security with all the personal information that will be transferred between the homeowner and the lender when completing the process.
Once a qualified lender has been established, then the home loan refinance online should progress very quickly. Since there are very few standards with the streamlined loan that the homeowner has to meet to be qualified, the paperwork can be completed very quickly. There are not any appraisals of the home needed, there is not any credit underwriting, and there is not a credit check on the homeowner.
The only thing that has to be established is that the current mortgage that the person has is an FHA loan that is in good standing, meaning that the person has not been consistently late on payments. It should also be proven that the person would benefit from the home loan refinance online by a better interest rate or one that is locked in at the same rate they currently have on an adjustable rate mortgage. Otherwise, there is not income verification that is needed and there is not a qualifying debt ratio needed because the individual is already paying on their mortgage consistently and the refinance will save them money, not require more.