The United States Department of Agriculture announced the USDA streamline refinance program in 2012 with the goal of helping USDA home loan holders all across the country. This refinance program is not yet a permanent entity and therefore this is made available in a limited number of areas. Right now this pilot program is available in 19 states of the country that have been classified as the hardest hit due to the recent economic downturn.
Features of USDA Streamline Refinance Pilot Program
The main aim of this pilot program is to help those people who already have USDA mortgages and are looking for an uncomplicated way of refinancing their loan program.
Before you apply for this type of program, there are several guidelines stated by the USDA that you need to qualify in order to eligible for this program. The first thing that you need to understand is that this streamline refinance program is only available for to those who are already holder of a USDA loan. Moreover, it is available for only a 30 year fixed rate and the new interest rate must be lower by at least 1 % as compared to the loan’s current USDA interest rate.
The USDA has made the process of applying for this program easier and faster as the applicant does not have to submit any type of documentation for credit and income appraisal. Another eligibility criterion that needs to be kept in mind is the property inspection. Some lenders of the USDA streamline refinance program may ask to inspect the property so as to make sure that the home or property meets the USDA housing guidelines. Apart from these eligibility criteria, all the USDA loan eligibility guidelines as well as income restrictions also apply to this pilot program.