Net tangible benefit worksheet single close maximum worksheet cash out refinance streamline refi only no cash out refinance acquisition or construction check14 native american loan guarantee program u. Iwe hereby authorize community housing innovations, inc. Fha streamline refinancing loans have a set of requirements connected to the loans benefit to the borrower. Fha streamline refinances are popular today because. Multistate borrower benefit worksheet for use in all states except. When fha insured financing is permitted, underwriting conditions and closing instructions must indicate no cash back to borrower is permitted not even one dollar ispermitted properties listed for sale in the last 6 months are eligible as follows. If there is not a state specific form, this worksheet should be used to provide the information supporting there is a net tangible benefit to the borrowers. This form must be retained in the lenders loan file.
With the simple fha refinance, lenders will require a credit qualification, which is the process of analyzing credit, income, and assets to ensure the borrower meets the requirements for the new loan terms. Tangible net benefit worksheet please fill out and email back to arizona department of housing. Summary of borrowers transaction, on hud lines 204209, with a corresponding reduction to the sellers proceeds in section k, summary of sellers transaction on. To update existing information, use refinance authorization on the case processing menu. Tangible net benefit to borrower page 1 542010 tangible net benefit to borrower worksheet conventional transactions borrower name. The outstanding principal balance 1 minus the applicable refund of the ufmip, plus the new ufmp that will be charged on the refinance. The new regulations now include a requirement that the lender must determine that there is a net tangible benefit ntb to the borrower as a result of the streamline refinance transaction. Huds net tangible benefit requirement is hampering fha streamline refinances. Converting from an adjustable rate to a fixed interest rate. Fha streamline refinance net tangible benefit ntb worksheet.
You may think that a coborrower can help you get approved. Who does fha mortgage insurance cover, the buyer or the. Tangible net benefit to borrower worksheet conventional. You also need to consider your total debttoincome dti ratio, which compares your earnings against monthly. The new case number for the refinancing mortgage cannot be requested prior to july 1st. Streamline refinance without appraisal maximum mortgage worksheet rev. The fha streamline refinance allows borrowers to reduce their rate with no pay stubs, no w2s, and no appraisal. What is required on a nonoccupying coborrower on home loans. Streamline refinances are available under credit qualifying and noncredit qualifying options. Lenders are generally more lenient with fha borrowers, due to the federal insurance backing they receive. How to remove a coborrower on an fha streamline refinance. The borrower will receive the following described tangible, net benefit through a refinancing of an existing loan please check every benefit that applies.
Mortgage lending and nonborrower household income a fannie mae housing working paper december 29, 2015 walter scott, senior economist. Pages one and two of this form are to be completed by the borrower as part of homebuyer education and verified by lender. Additional information may be provided on supplemental sheets or on the reverse if the. Additional information may be provided on supplemental sheets, if necessary. The underwriter must determine there is a documented net tangible benefit to the borrower s per the standards in the charts below for all streamline refinance transactions. There are certain stipulations that must be followed in order to be able to use income that does not belong to the borrower, but rather the extended household members. This is what makes fha loans so popular among firsttime home buyers. The apr of this refinancing, at consummation, does not exceed by more than 2. The following worksheet must be used in the determination of a borrowers tangible net benefit as the benefit relates directly to the new loan extended.
The fha changed the rules on streamline refinancing loans for all case numbers assigned on or after april 18, 2011. For mortgage loan applicants who have a debt to income ratios higher than 46. A mortgagerefinancing option offered by the federal housing administration fha. Net tangible benefit number of payments made on current mortgage at least six example. In these cases, nonborrower income is able to be used, not for qualifying purposes, but rather as a compensating factor. For information on streamline refinances without an appraisal, see hud 4155. The information provided below reflects estimates of the charges that are likely to be incurred at the settlement of this loan. New fha guidelines does not allow your new mortgage balance to increase.
A streamline refinance may also benefit the borrower by allowing him to remove an exspouse originally listed as a coborrower on the loan. Fha streamline refinance rules for net tangible benefits. Link to lender query by case number, which is a single family servicing menu option on the fha connection. Refinance to lower interest rate with the same term as the original loan. This worksheet will give you an indication of your financial health and your readiness to purchase a home. Generally, the streamline refinance can be completed with or without credit qualifying or an. While fha and conventional loans allow for a nonoccupying coborrowers. Fha streamline refinancing rules for addingremoving borrowers.
Streamline refinance with an appraisal worksheet 102610x. Fha mortgage loans offer several benefits for home buyers. To get fha approval for a streamline refinancing loan, there must be a net tangible benefit to the borrower as a result of the. Streamline refinance without an appraisal worksheet 11. Exh 03500 fha maximum down payment worksheet rev 120511 borrower. How a coborrower can help you get approved for a mortgage. Fha streamline refinance benefits fha news and views.
As a general rule, your total housing expense, including taxes and insurance, should not exceed 33% of your gross income. Fha streamline refinance rules state that in order for the loan to be approved, the lender must determine that the refinance loan has some type of actual benefit to the borrower. Fha net tangible benefit worksheet streamline refinance 122016 fha net tangible benefit worksheet streamline refinance. Fha maximum mortgage worksheet cashout refinance maximum loan amount before adding the financed upfront mortgage insurance premium is the lower of the following two calculations. Tangible net benefit worksheet the original of this form must be retained in the lenders loan file.
The government through the fha insures these loans against losses that result from borrower default. Borrower eligibility requirements overview in this section this section contains the topics listed in the table below. Hud has a requirement that in order for a borrower to do a streamline refinance their existing fha mortgage, their scenario must have a net tangible benefit. If the prior mortgage was fha insured, add the lender contacts telephone number. The case number and original mortgage amount are entered on the lender query by case number page to retrieve the annual mip factor premium rate for periodic mip and other details for an endorsed insured case. And, a principal reduction is usually a benefit that cant be unearned, whereas an interest rate reduction could be taken away from you. Form 92561 in the efolder and signed or conditioned for 80. The department of housing and urban development hud sets all guidelines for allowable fha closing costs and fees.
Coborrower removal with an fha streamline refinance. Summary of borrower s transaction, on hud lines 204209, with a corresponding reduction to the sellers proceeds in section k, summary of sellers transaction on hud lines 506509. January 2012 department of the treasury internal revenue service request may be rejected if the form is incomplete or. A reduced combined rate refers to the interest rate on the mortgage plus the mip rate. Net tangible benefit test is met if the answer to the applicable loan question is yes. Streamline refinance without appraisal maximum mortgage. Topic topic name see page 1 borrower, coborrower, and cosigner eligibility requirements 4a2 2 eligibility for fhainsured financing 4a6 3 citizenship and immigration status 4a 4 living trusts 4a15. The fha case number on the mortgage being refinanced was closed on or before december 1st, and the borrowers first payment on that mortgage was due on january 1st. Qualifying for a homeready mortgage using nonborrower. According to hud, mortgage lenders are required to make sure the fees charged to the borrower i. Gotta ask, what is your operative credit score for the transaction, and how much are you putting as a down payment. Borrower benefits can sometimes have restrictions and limits. There are many times where a home buyer may need a nonoccupying co borrower to be added on their mortgage loan due to not having enough qualified income to qualify on their own.
There is also a home appraisal, to see how much the house has increased in value. This refinancing is a new home loan guaranteed, originated, or funded by the fha, va, or other state of federal housing finance agencies. Seller credit itemization list items charged in the borrower column. The following worksheet is used to determine if the borrower s net tangible benefit meets lenderlives andor fha s requirements. Hope loan details for hope cases prior to july 29, 2011 to view the results of the propertyborrower validation, click propertyborrower validation results. Itemized fee worksheet 022010 encompass360tm itemized fee worksheet for use with service providers and investors date. If the credit score is over, say, 600, and you are putting 3. In this article, we will cover and discuss fha nonoccupant coborrower guidelines on fha loans.
Fha simple refinance learn about 2020 mortgage options. If the above benefit to borrower is not met the loan cannot be streamline refinanced. The same goes for credit scores and other qualifications. Hud mortgagee letter 201020 outlines new minimum net worth requirements for fha lenders, and also phases out the loan correspondent program, which allows mortgage brokers direct approval authority. But is an fha streamline possible while simultaneously removing a borrower from the loan.
Tangible net benefit worksheet a net tangible benefit must be determined on all primary home loan refinances. Fha streamline refinances are designed to lower the monthly principal and interest payments on a current fhainsured mortgage. The following worksheet must be used in the determination of a borrowers tangible net benefit as the benefit relates directly. Streamline refinance refers to the refinance of an existing fhainsured mortgage requiring limited borrower credit documentation and underwriting. Streamline refinances can be made with or without an appraisal. For instance, what if youve gone through a divorce since you purchased your home. In situations where a borrower wishes to refinance an fha mortgage with fha streamline refinancing, there may be a need to add or remove another borrower. These charges can add up to between 3% and 5% of the loan amount. If a borrower is getting a divorce, for example, refinancing the property under a single persons name removing the spouse would make sense. The biggest benefits are easier qualification and smaller down payments. Streamline refinance with an appraisal worksheet rateterm refi. Form 4506t request for transcript of tax return rev.