I received a call from Bank of America a little while ago asking me if I wanted to refinance my mortgage. Of course… but I am self employed, doesn’t that make it difficult for me to get a new loan these days? Apparently not if I qualify for a B of A streamlined refinance.
What is a Streamlined Refinance?
If you have a Bank of America mortgage (Or any other company that offers this option – my experience is just with B of A) you may be able to refinance to a lower rate without having to pay for an appraisal or have your income verified. I paid $12 out of pocket, they will wrap the $2K in closing costs into my loan and voila! I have a new, much reduced monthly payment. It really is that easy and you don’t necessarily have to have equity in your home. Even if you owe more than the market would pay for your home right now, you may qualify. Of course not all loans are eligible for a streamlined refinance but if you have an FHA loan, VA loan or Fannie Mae/Freddie Mac backed loan that qualifies for HARP (Making Homes Affordable Refinance Program) then you are in luck. There is so much more to know so read up on the details and contact your mortgage provider to see if you qualify.
Should I do a Streamlined Refinance?
Just as with any refinance you should look at your numbers before you jump into a ‘better deal.’ If you are planning on staying in the house for a long time, it likely makes sense to refinance. If you are planning on moving soon, then does the cost of the refinance outweigh the monthly savings? How much are the closing costs? How long will it take for you to re-coop that money in your monthly savings with the new loan? For me personally I calculated I would make up the $2K in closing costs in about 6 months, so that was a no brainer for me! After that I can take the savings and put it towards the principal to pay my loan down faster. If you would like any help figuring out if a refinance might be right for you just call me and we can calculate it together.