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10 Best FHA Streamline Refinance Lenders of 2020

NerdWalletJanuary 2, 2020

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NerdWallet has considered some of the largest FHA streamline refinance lenders in the nation to provide you a shortlist of the best in several categories.

An FHA streamline refinance is a faster and cheaper way to get a better deal on your FHA-insured mortgage.

Not all FHA streamline refinance lenders are the same. Lenders can add additional requirements to FHA loans, including a minimum credit score — and lender fees can vary as well.

NerdWallet has considered some of the largest FHA streamline refinance lenders in the U.S. to provide you with a shortlist of the best-in-class in several categories.

Summary of Best FHA Streamline Refinance Lenders of 2020

LenderNerdWallet Rating Minimum Credit Score Minimum Down PaymentLearn More

Quicken Loans: NMLS#3030

at Quicken Loans

Best for online experience

620

3%

at Quicken Loans

loanDepot: NMLS#174457

at loanDepot

Best for online experience

620

3.5%

at loanDepot

Alterra: NMLS#133739

Best for unique services

620

3%

Read review

Veterans United: NMLS#1907

at Veterans United

Best for unique services

660

0%

at Veterans United

Guaranteed Rate: NMLS#2611

Best for a nonbank lender

620

3%

Read review

HomeBridge: NMLS#6521

Best for a nonbank lender

620

3%

Read review

PennyMac: NMLS#35953

Best for low credit score borrowers

620

3%

Read review

Vylla: NMLS#2600

Best for low credit score borrowers

620

3%

Read review

Bank of America: NMLS#399802

Best for a traditional bank

620

3%

Read review

BB&T: NMLS#399803

Best for a traditional bank

620

3%

Read review
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at Quicken Loans

Quicken Loans: NMLS#3030

Logo

Min. Credit Score

620

Min. Down Payment

3%

at Quicken Loans


Why we like it

Ideal choice for convenience and quick-response customer service. Quicken Loans provides just about all the services your neighborhood lender does — with online convenience.

Pros

  • Quicken Loans couples a fully online application with available mortgage advisors for those who want a human touch.

  • Instantly verifies employment and income for more than 60% of working Americans.

  • Offers custom fixed-rate loan terms that are between eight and 30 years.

  • Provides FHA-backed loans, USDA loans as well as products offered by Freddie Mac and Fannie Mae that require down payments as low as 3%.

Cons

  • Quicken Loans doesn't offer home equity loans or HELOCs.

  • If you’re a “look me in the eye” type of customer, you’re out of luck.

  • Doesn’t consider alternative credit data. It just looks at credit scores and debt-to-income ratios, the way most mortgage lenders always have.

Read Full Review
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at loanDepot

loanDepot: NMLS#174457

Logo

Min. Credit Score

620

Min. Down Payment

3.5%

at loanDepot


Why we like it

Ideal for borrowers looking to get a mortgage with help from a loan officer. Digital back-office operations are said to add efficiency to the loan process.

Pros

  • Offers digital income, asset and employment verification.

  • Has over 150 affiliated loan stores nationwide for customers who prefer face-to-face service.

  • One of the nation’s most active lenders of FHA and VA loans.

Cons

  • Published mortgage rates include up to three points of prepaid interest and fees.

  • Does not offer home equity loans or lines of credit.

Read Full Review

Alterra: NMLS#133739

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Min. Credit Score

620

Min. Down Payment

3%


Why we like it

Ideal for Latino and other minority borrowers, millennials, foreign nationals, as well as those seeking a full array of purchase and refinance loans, including jumbo mortgages.

Pros

  • Offers an ITIN qualification path for undocumented immigrant borrowers.

  • Has a digital application process.

  • Offers several mortgage options for low- to moderate-income borrowers.

  • Has a full Spanish-language version of its website and bilingual loan officers.

  • Borrowers can qualify with income from self-employment and other nontraditional sources.

Cons

  • No mortgage rates published online.

  • Doesn't lend in all states.

  • No home equity loans or lines of credit.

Read Full Review
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at Veterans United

Veterans United: NMLS#1907

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Min. Credit Score

660

Min. Down Payment

0%

at Veterans United


Why we like it

Ideal for veterans and active-duty service members. Veterans United is the nation's largest VA home purchase lender but also offers an excellent selection of other government and conventional loans.

Pros

  • Also offers FHA, USDA and conventional loans.

  • Offers 24/7 customer service.

  • You can complete a loan application and pre-qualify online.

  • Registers a low volume of complaints filed with the Consumer Financial Protection Bureau.

  • Offers free credit score education and assistance.

  • Provides a client advocate team staffed by former senior enlisted leaders from each branch of the armed forces.

Cons

  • Doesn’t offer home equity loans or HELOCs.

  • Loans are available in all 50 states, but Veterans United has offices in only about half.

Read Full Review

Guaranteed Rate: NMLS#2611

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Min. Credit Score

620

Min. Down Payment

3%


Why we like it

Ideal for borrowers who are looking to apply for a mortgage and manage the process through online tools, whether buying or refinancing. Guaranteed Rate offers FHA, VA and USDA loans for borrowers who are well-qualified.

Pros

  • Works with most borrowers as long as they have good credit scores and incomes.

  • Provides a user-friendly digital platform that’s thorough in covering all types of borrowing scenarios.

  • Has a 95% customer satisfaction rate, according to company data.

Cons

  • Charges some fees, such as a $1,290 lender fee that includes a $150 application fee.

  • Offers many products, which might confuse or overwhelm borrowers.

  • Several click-throughs required for personalized rates.

Read Full Review

HomeBridge: NMLS#6521

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Min. Credit Score

620

Min. Down Payment

3%


Why we like it

Ideal for borrowers who prefer an online experience. Homebridge offers a variety of home loan options and an online application.

Pros

  • A wide variety of loan types.

  • Low credit score requirements for government-backed loans.

  • A wealth of educational material on its website.

  • Licensed in all 50 states.

Cons

  • Mortgage application can't be tracked online.

  • Charges origination fees on some loans.

  • Limited branch locations.

Read Full Review

PennyMac: NMLS#35953

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Min. Credit Score

620

Min. Down Payment

3%


Why we like it

Ideal for borrowers who want plenty of loan options, as well as advice and help over the phone. PennyMac offers a variety of mortgage types, boasts of its employees' communication skills and services its own loans.

Pros

  • Provides a single point of contact during loan processing.

  • Customized rate estimates are available before registering.

  • Electronic document submissions and online updates.

  • Services its loans after closing.

Cons

  • Mobile app is only for current borrowers and can't be used to apply for a new loan.

  • No retail branches.

  • Charges an origination fee, which it says is typically $1,100.

Read Full Review

Vylla: NMLS#2600

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Min. Credit Score

620

Min. Down Payment

3%


Why we like it

Ideal for first-time home buyers or credit-challenged borrowers who may have trouble qualifying for a mortgage.

Pros

  • Low minimum credit score.

  • Online application, loan tracking and document upload.

  • Free rate locks.

Cons

  • No online preapproval.

  • No presence in Massachusetts or North Dakota.

Read Full Review

Bank of America: NMLS#399802

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Min. Credit Score

620

Min. Down Payment

3%


Why we like it

Ideal for borrowers who prefer a traditional bank. Bank of America offers a wide array of mortgages and online account management tools. It also has first-time home buyer loans with low down payments and no mandatory mortgage insurance.

Pros

  • Allows borrowers to apply entirely online.

  • Offers down payment and closing cost assistance programs.

  • May give existing customers a discount on mortgage lender origination fees.

Cons

  • Does not offer renovation loans.

Read Full Review

BB&T: NMLS#399803

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Min. Credit Score

620

Min. Down Payment

3%


Why we like it

Ideal for borrowers in the Southeast who want online tools with the option of face-to-face service. BB&T, now part of Truist Financial Corp., offers a full menu of home loans.

Pros

  • Offers a variety of low-down-payment mortgage options

  • Offers construction loans to build a home or make significant renovations to an existing home.

  • Flexible borrowing and payment options for home equity loans and lines of credit.

  • Full suite of online capabilities.

Cons

  • Branches limited mostly to the Southeast.

Read Full Review

More from NerdWallet

FHA streamline refinance FAQ

What is an FHA streamline refinance?

An FHA streamline refinance involves replacing an FHA-insured mortgage with another FHA loan that has a lower interest rate, shorter term, or both. It’s streamlined because the new loan doesn’t require an FHA appraisal. This speeds up the process and reduces fees.

What if I don't have an FHA loan?

You have to have an FHA-insured mortgage to get an FHA streamline refinance. It is possible to refinance a non-FHA loan into an FHA loan, but the lender would require an appraisal, income verification and credit check, so it wouldn’t be deemed “streamlined.”

What are the pros and cons of FHA loans?

The FHA allows minimum down payments of 3.5% for borrowers with credit scores of 580 or higher. Conventional loans, which are not insured by the federal government, tend to require higher credit scores.

Under the FHA’s rules, borrowers may receive gifts of down payment money from family, “close” friends, employers, unions, charitable organizations, as well as a “governmental agency or public entity.”

FHA borrowers pay upfront and monthly mortgage insurance premiums. Monthly premiums can’t be canceled. The only way to get rid of FHA mortgage insurance is to pay off the loan, refinance into a non-FHA loan or sell the house. By contrast, private mortgage insurance on conventional loans may be canceled after the borrower gains sufficient equity.

What's the minimum credit score for FHA?

Borrowers with credit scores of 580 or higher may qualify for FHA-insured loans with down payments as low as 3.5%. Borrowers with credit scores of 500 to 579 may qualify for FHA loans with down payments as low as 10%. See this explanation of how minimum down payments for FHA loans depend on borrowers’ credit scores.

Can I get an FHA streamline cash-out refinance?

A cash-out refinance happens when a borrower replaces their current mortgage with a mortgage for a higher loan amount, and takes the difference in cash. The FHA’s streamlined refinance program limits borrowers from taking out more than $500 in cash from the refinance. Borrowers can’t increase the loan amount to cover closing costs.

Last updated on January 2, 2020

Methodology

NerdWallet's selection of mortgage lenders for inclusion here was made based on our evaluation of the products and services that lenders offer to consumers who are actively shopping for the best mortgage. The six key areas we evaluated include the loan types and loan products offered, online capabilities, online mortgage rate information, customer service and the number of complaints filed with the Consumer Financial Protection Bureau as a percentage of loans issued. We also awarded lenders up to one bonus star for a unique program or borrower focus that set them apart from other lenders. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.

To recap our selections...

NerdWallet's Best FHA Streamline Refinance Lenders of 2020