fha streamline refinance ltv guidelines explained for today’s borrowers

What LTV means on a Streamline

Unlike most refinances, an FHA Streamline often skips an appraisal, so loan-to-value (LTV) is not used to qualify. Your new base loan typically equals your existing unpaid principal balance, and you can finance the new upfront mortgage insurance premium (UFMIP). Closing costs are not added unless a lender credit covers them.

When an appraisal is ordered

If you choose or are required to get an appraisal, standard FHA rate/term limits apply: the maximum LTV generally cannot exceed 97.75% of the appraised value on a primary residence. Any existing subordinate liens may remain, but they cannot increase, and total financing must meet FHA rules and lender overlays.

Other factors lenders check

• Net tangible benefit: a clear advantage, such as a lower rate or payment, is required.
• Seasoning: at least six payments made and 210 days from the first payment due date.
• Occupancy and credit: FHA insures streamline loans on previously insured properties; some credit review and payment history are verified.
• Cash back: not allowed, aside from minor adjustments at closing.

Discuss your goals with your lender to decide whether a no-appraisal or with-appraisal path best fits your equity and payment targets.