Refinance 2016 Credit Score 

Refinance 2016 Credit Score

We hear it all the time!

What's the minimum credit score to refinance?

The answer is. It depends on who you ask.

All the major banks Wells Fargo, Bank of America, Chase, Citigroup, etc. have minimum credit score requirements. When you apply for a mortgage at a major bank and they tell you their minimum credit score requirement is 640. This does not mean that it's the minimum credit score to qualify for a mortgage. It means that they are the bank's minimum credit score requirements.

Because the banks make the rules for loans they will approve they may require a minimum credit score of 640 for their loans. These guidelines are the bank's guidelines. What this means is that all the major banks including Wells Fargo, Bank of America, Chase, Citigroup, etc. banks make the rules for the loans they approve.

To be able to refinance will depend on which program you qualify for. If you currently have a mortgage and want to change the terms or want to cash out these are the programs that are available:

• FHA Refinance Program
  
• FHA Streamline Program
• VA Refinance Program
• VA Streamline Program
• Fannie Mae HARP Streamline
  
• Fannie Mae refinance
  

New FHA guidelines changes requires that new borrowers have a minimum credit score of 500 to qualify for a FHA mortgage. New borrowers will now be required to have a minimum credit score of 580 to qualify for FHA's 97.75% rate & term program. New borrowers with less than a 580 credit score will qualify for FHA's 90.00% rate & term program.

This allows the FHA to better balance its risk and continue to provide access for those borrowers who have historically performed well. These changes went into effect in 2010.

VA streamline there must be a net tangible benefit to the homeowner. Net tangible benefit is defined as a 5% reduction to the principal and interest (P&I) of the mortgage payment plus the annual mortgage insurance premium (MIP) or  from an Adjustable Rate Mortgage (ARM) to a fixed rate mortgage.

Fannie Mae the Making Home Affordable program allows borrowers who are underwater to qualify with no minimum credit score. With a 620 credit score up to a maximum loan-to-value of 200%. If you are current on your mortgage with or without equity then you are eligible for this program.

Jumbo loans require 85% loan-to-value up to 1 million dollar no mortgage insurance and 80% loan-to-value up to 1.5 million. Up to $4 million loan amounts. Loans over the $417,000 limit set for conventional loans are considered jumbo loans.

Refinance credit score 2016 Interest rates make now the perfect time to refinance.  Low mortgage rates result in lower monthly payments which can save you thousands of dollars off the life of the loan.

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We look forward to working with you.

We look forward to working with you.

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