Refinancing a primary residence FHA loan on investment property

[Nicole Barry]

I have a 9-year old primary residence FHA loan on a property that used was my primary residence, I do not pay PMI. Now it is an investment property. I'd like to refi to take advantage of lower rates. My mortgage co says that I can do a streamline refi, but I'm assuming that they mean for a primary residence, which the home isn't. Can I request to streamline refi my current FHA primary home loan into an investment loan? Would it still benefit me financially to do so?

[Zack Karp]

@Nicole Barry yes you can absolutely do that. FHA allows properties converted to investment properties to be streamlined, and at the same rate as a primary too. Not many people know you can do that, and frankly not many LO's know that either LOL.

Best of luck!

[Nicole Barry]

Zack, this is interesting news. During the process, do I simply tell my mortgage co that I won't be using as my primary residence and take it from there? I assume that when title is pulled, it will show that it's not a primary residence because tax records shows this. I'm worried about doing something inappropriate accidentally.

[Zack Karp]

@Nicole Barry just make sure you are working with an experienced LO that has done these before.  They should know exactly what to do.  If you're nervous about it, you're probably working with the wrong LO.  They should be the one putting you at ease, instead of a random guy on BP.  LOL.

[Nicole Barry]

LOL, thank you!

[Andrew Lamb]

Zach is right! I have the same issue, except that mine does have MIP since it's from 2017. We're not at 75% LTV just yet, so a streamline makes the most sense until I can refi to a conventional. Most lenders I've talked to say they can't use the streamline on a non-owner occupied, but I've read the guidelines myself and they can. Not sure what the confusion is.

From what I can tell, you can't take cash out on a Streamline refi though. Not planning to, but noticed that's not something FHA allows.