How FHA loans work
The Federal Housing Administration doesn’t lend money directly. It insures loans made by approved lenders, which lets those lenders offer more flexible guidelines. In exchange, FHA loans include mortgage insurance: an upfront premium, which can be added to the loan, and an annual premium paid monthly.
FHA loans can be used to buy single-family homes, FHA-approved condominiums and two- to four-unit properties, as long as you live in the home.
FHA Streamline refinance
If you already have an FHA loan, an FHA Streamline refinance can lower your interest rate and monthly payment with less paperwork than a standard refinance. A streamline usually doesn’t require new income or asset documentation, and many don’t require an appraisal. In some cases closing costs can be covered by a lender credit, so you pay little or nothing out of pocket.
To qualify, your loan must be current, at least 210 days must have passed since it closed, you must have made at least six payments, and the refinance must give you a net tangible benefit, such as a lower combined interest rate and mortgage insurance payment.