There is still one mortgage program that allows you to refinance without having to verify your credit scores. 

 Yes, you can have a credit score in the 500’s, or even lower, and still get approved for a mortgage refinance.

The only program that allows this approval is called a FHA Streamline Refinance.

What is a FHA streamline refinance?

It’s similar to a regular mortgage refinance, but your current mortgage loan that is being paid off has to a FHA loan as well.  So, you are basically going from an existing FHA mortgage loan to a new FHA mortgage loan.

Now, a streamline does not allow you to take any additional cashout.  The purpose of the streamline refinance is to lower your existing interest rate, if available at that time.

What are the benefits of doing an FHA stramline refinance?

The most popular reasons why someone would qualify for a streamline versus any other mortgage loan are the following:

• No credit score verification is necessary.
• No income verification is necessary.
• No asset verification is necessary.
• No home appraisal is necessary.

This program has become extremely popular for these types of people:

• If your homes value has depreciated to the point where you owe more on your mortgage than the home is worth.
• Self employed person.  It’s always difficult to verify income for these people.
• People with low credit scores.  As long as you are current on your mortgage.

The FHA streamline refinance will continue to be one of the most popular mortgage refinance programs on the market.  The mortgage rates continue to be at historic lows,  so anyone currently in a FHA mortgage loan will benefit from refinancing into these lower interest rates.

If you would like a second, or even a third, opinion on the refinance you are looking to do, please don’t hesitate to contact me.  On the top of this site, you can check out the list of states I’m able to help someone with financing.

I specialize in bad credit mortgage loans and I do all I can to talk about how less than perfect credit can still get you a mortgage loan approval.

Government programs are in full force nowadays and they do not have a minimum credit score to qualify.

I encourage you to leave a comment with your feedback or questions.

Here are the three options you have when looking for a true no down payment mortgage loan. I’ve also laid out some details of each program, so you can get an idea of what they are all about.

1. VA (Veterans Affairs) Mortgage Loan - Whether you or your spouse are currently in active duty or a military veteran, you can be eligible to obtain a VA mortgage loan. No down payment is required with this loan program. A VA loan has many benefits for military personal, that is should be taken advantage of. Here are the list of benefits that come with a VA mortgage loan…

- No down payment.
- Less of a PMI (private mortgage payment) payment.
- Favorable and secure 30 year fixed interest rates.
- No minimum credit score to qualify. Even if you have bad credit, a VA loan is approved based on your ability to show you can afford the mortgage payments.

You have two ways to be approved:

1. Approval through an automated underwriting engine.
2. A manual underwrite. Sometimes, the automated engine doesn’t approve your application, but that’s OK. It still allows your application to be underwritten manually by an underwriter. Basically, if you can show ability to pay the mortgage with good employment history, you will most likely be approved.

You may be able to obtain a VA loan multiple times. A form called the, Certificate of Eligibility, is required when applying for a VA loan and this determines whether or not you have enough “eligibility” left to qualify for another VA loan. Sometimes, a borrower doesn’t use all of his/her eligibility, which can be used again for a future purchase on a new home.

2. Rural Housing Mortgage Loan - If you find a home in a rural area and your adjusted annual gross income doesn’t exceed the moderate income limits for the area, you can qualify for a rural housing mortgage loan. No down payment is required with this loan program. A rural mortgage loan has many benefits for a borrower that is looking to purchase a home in a rural area. Here are the list of benefits that come with a rural mortgage loan…

- No down payment.
- No PMI. (private mortgage insurance)
- Favorable and secure 30 year fixed interest rates.
- Seller can pay up to 6% of the purchase price, to the buyer, for closing costs and prepaids. This allows the buyer to truly not have to bring money to closing, since there is no down payment.

You may finance up to 102% of the appraised value or purchase price, whichever is lower. The 2% is meant to finance the closing costs and prepaid items like the escrow account, so you truly do not have to bring money to closing.

3. FHA Mortgage Loan With A Down Payment Assistance Program - If the seller agrees to participate in a down payment assistance program, the buyer can use these funds towards his 3% down payment when applying for a FHA loan. This is how you can truly do a no down payment FHA mortgage loan. A down payment assistance program allows the seller to gift 3% of the purchase price to a 3rd party service, which in turn the buyer can use the 3rd party service and it’s funds for the down payment. Here are the list of benefits that come with a FHA loan…

- No down payment, when using a down payment assistance program.
- Less of a PMI (private mortgage insurance) payment.
- Favorable and secure 30 year fixed interest rates.
- No minimum credit score to qualify. Even if you have bad credit, a FHA loan is approved based on your ability to show you can afford the mortgage payments.

You have two ways to be approved:

1. Approval through an automated underwriting engine.
2. A manual underwrite. Sometimes, the automated engine doesn’t approve your application, but that’s OK. It still allows your application to be underwritten manually by an underwriter. Basically, if you can show ability to pay the mortgage with good employment history, you will most likely be approved.

These are the only 3 options that are available in this current lending environment. Fortunately, there are no down payment options available and I’m glad to say I specialize in working with first time home buyers to help them obtain these types of mortgage programs.