FHA Streamline Refinance Calculator Worksheet
An FHA Streamline Refinance is designed for homeowners with existing FHA-insured loans to refinance into a new FHA loan, typically with a lower interest rate and monthly payment. This process usually involves less paperwork and underwriting than a standard refinance. Use this calculator worksheet to estimate potential savings and understand key figures.
How to Use This FHA Streamline Refinance Worksheet
This calculator acts as an interactive worksheet to help you estimate the potential financial impact of an FHA Streamline Refinance. To use it effectively, gather your current FHA loan information and a realistic estimate for a new interest rate and closing costs.
- Current Loan Balance (Principal): Enter the outstanding principal amount on your existing FHA loan. You can find this on your latest mortgage statement.
- Current Annual Interest Rate: Input the current interest rate for your existing FHA loan.
- Current Monthly P&I Payment: Enter your current monthly payment for principal and interest (P&I) only. Do not include escrow payments for taxes and insurance. This is crucial for comparing against the new estimated P&I payment.
- New Proposed Annual Interest Rate: Enter the interest rate you anticipate or have been quoted for the new FHA Streamline loan. Market rates fluctuate, so this may be an estimate.
- Remaining/New Loan Term (Years): Typically, for an FHA Streamline, you’ll refinance for a term that does not exceed the remaining term of your current loan by more than a few months, or a new 30-year term if preferred and allowed. Input the desired term in years.
- Estimated Closing Costs: Enter the total estimated closing costs for the refinance. These can include lender fees, title charges, recording fees, etc. This does NOT include the Upfront Mortgage Insurance Premium (UFMIP), as the calculator adds that separately if rolled in.
- Roll Costs into New Loan?:
- Yes, include UFMIP & Closing Costs: Both the calculated UFMIP (1.75% of the current loan balance) and your entered closing costs will be added to the current loan balance to determine the new total loan amount.
- Yes, include UFMIP only: Only the UFMIP will be added to the new loan amount. You would pay the entered closing costs out-of-pocket.
- No: Neither UFMIP nor closing costs will be added to the new loan amount. You would pay both out-of-pocket.
Understanding Your FHA Streamline Refinance Results
After clicking “Calculate Refinance Potential,” the results section will display key estimates:
- Estimated New Monthly P&I Payment: The projected principal and interest payment for your new FHA Streamline loan. This does not include new annual MIP, property taxes, or homeowner’s insurance.
- Estimated Monthly P&I Savings: The difference between your current P&I payment and the new estimated P&I payment. A positive number indicates savings.
- Total New Loan Amount: The new principal balance if UFMIP and/or closing costs are rolled into the loan.
- Upfront Mortgage Insurance Premium (UFMIP) Added: The amount of UFMIP (1.75% of current loan balance) that was included in the new loan amount if you chose to roll it in.
- Break-Even Point: An estimate of how many months it will take for your monthly savings to cover the total cash out-of-pocket costs (entered closing costs plus UFMIP if not rolled in). If all costs are rolled in and there are savings, this typically shows “N/A” or 0, as the benefit is immediate in terms of payment reduction.
- Net Tangible Benefit (NTB) Check: FHA Streamlines require a “Net Tangible Benefit” to the borrower. This calculator primarily checks for a reduction in the P&I payment. Other NTB criteria exist (e.g., refinancing an ARM to a fixed rate).
Key Considerations for an FHA Streamline Refinance
Net Tangible Benefit (NTB)
Lenders must ensure the refinance provides a tangible benefit. Common NTBs include:
- A reduction in the combined principal, interest, and annual mortgage insurance premium (MIP) payment. This calculator focuses on P&I reduction as a primary indicator.
- Refinancing from an Adjustable Rate Mortgage (ARM) to a Fixed-Rate Mortgage.
- A reduction in the loan term.
Mortgage Insurance Premiums (MIP)
- Upfront Mortgage Insurance Premium (UFMIP): For most FHA Streamlines, a UFMIP of 1.75% of the base loan amount is charged. This calculator allows you to see the impact of rolling this into your new loan. Some borrowers whose original FHA loan was endorsed on or before May 31, 2009, may receive a refund of their old UFMIP, which can offset the new UFMIP. This calculator does not account for UFMIP refunds.
- Annual Mortgage Insurance Premium (Annual MIP): You will also pay an annual MIP, collected in monthly installments. The rate for annual MIP can vary. This calculator’s P&I payment does NOT include the new annual MIP. Your lender will provide the exact MIP amount. The NTB is often based on the combined P&I + Annual MIP.
Closing Costs
Closing costs can vary by lender and location. They may include appraisal (though often not required for Streamlines), title insurance, recording fees, and lender fees. You can pay these out-of-pocket, or sometimes the lender may offer a “no-cost” refinance (usually by charging a higher interest rate), or you can roll them into the loan principal if there is sufficient equity and program guidelines allow (as an FHA Streamline is typically limited to the existing loan balance plus the UFMIP). This calculator models rolling user-entered closing costs into the loan.
Loan Seasoning and Payment History
Generally, you must have made at least six payments on your current FHA loan, and payments must have been on time for a specified period (e.g., the last 6 months, with no more than one 30-day late payment in the past 12 months). Check with your lender for specific requirements.
Disclaimer: This calculator provides estimates for informational purposes only and does not constitute financial advice or a loan offer. Actual loan terms, payments, and savings will vary based on your specific financial situation, lender requirements, market conditions, and the FHA program guidelines at the time of your application. Always consult with a qualified mortgage professional or FHA-approved lender for personalized advice and official loan estimates.