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Need to get a lower interest rate on your mortgage? Are you thinking of refinancing to stop dealing with the interest rate adjustments of an ARM loan? Or maybe you are considering a refinance loan to cash in on the equity in your home.   FHA home loan options are available.

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FHA.com is a privately owned website, is not a government agency, and does not make loans.

Refinancing Your FHA Mortgage Without a Credit Check

November 4, 2021

Refinancing Your FHA Mortgage Without a Credit Check
Need to get a lower interest rate on your mortgage? Are you thinking of refinancing to stop dealing with the interest rate adjustments of an ARM loan? Or maybe you are considering a refinance loan to cash in on the equity in your home. 

FHA home loan options include refinancing for all of the needs mentioned above. You also have the ability to apply for an FHA 203(k) Rehabilitation Refinance loan so you can refinance the original home loan (conventional, FHA, or otherwise) and use loan proceeds to repair or upgrade your home (the projects must be on an FHA approved list).

If you have any kind of existing mortgage you have the option to apply for an FHA cash-out refinancing to cash in on the equity in your home.

When Is a Credit Check Required to Refinance?

When you consider an FHA refinance loan, you will need a credit check and an appraisal in most cases--especially if you’re looking for cash out on the transaction. However, not ALL FHA refinance options require the credit check or appraisal.

For situations where a borrower wants to refinance an existing FHA home loan, there is an option called the FHA Streamline Refinance loan (sometimes called an FHA Interest Rate Reduction Refinance Loan).

FHA Streamline Refi

What is a Streamline Refinance loan? It’s one intended only for existing FHA mortgages. The lender can use your original application information for the new loan. Part of the reason for the “no credit check” option here? The borrower is not getting cash back, and the loan should be technically more affordable or better manageable by the borrower.

No credit check is only part of the picture--FHA Streamline Refinance rules say there is no FHA-required appraisal. Keep in mind that your lender is free to require appraisals or credit checks anyway depending on circumstances but the FHA loan rules don’t automatically demand these steps for Streamline Refinances.

Existing FHA Mortgages

One important caveat here--you cannot use the FHA Streamline Refinance option on non-FHA mortgages. Most non-streamline FHA refinance loan options we have mentioned here require credit checks, appraisals, and those who decide to go a different route and consider refinancing an FHA mortgage into a conventional loan? Be prepared for a new appraisal and credit check in those circumstances.

You don’t need to use your current lender to refinance--borrowers should always shop around for a new lender even if it’s just to compare terms and interest rates. You’ll be glad you did. An informed borrower is much happier with the transaction overall.

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