An educational look at how the USDA streamlined assist refinance works for homeowners who already have a USDA guaranteed loan, with an estimator for the payment test.
Existing USDA loans only
Educational overview
No cash out
Your USDA loan and the new one
Sample figures, edit freely
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yrs
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$
New loan term
Years you will keep the loan
USDA charges an upfront guarantee fee, about 1.00% at this writing, which this estimator adds to the new loan. The annual fee is about 0.35%. Confirm current figures, because USDA sets them.
Estimate only and for education. Payments include principal, interest and the annual fee on the starting balance, not taxes or insurance. Program rules, fees and eligibility are set by USDA and the lender.
How the USDA streamline works
Existing USDA loan. Only loans already guaranteed by USDA qualify for the streamlined assist refinance.
Reduced documentation. The program is built to need less. Typically there is no new appraisal and limited income and credit review. The lender may add its own requirements.
Payment test. The new payment generally has to be at least $50 a month lower.
Payment history. Your current loan generally has to be current, with a clean recent payment record.
Fees. USDA charges an upfront guarantee fee and an annual fee. Confirm the current percentages.
No cash out. The new loan is meant to cover the payoff and allowed costs, not to provide cash.
At a glance
What the program looks at
Rules come from USDA and the lender. Use this as background, then confirm the details for your loan.
Existing USDA guaranteed loan
Payment drop of $50 or more
Annual fee about 0.35%
Upfront fee about 1.00%
No cash out
Questions to settle first
Is your loan USDA? Check your closing documents or loan statement, or ask your servicer. A USDA guaranteed loan names USDA Rural Development.
Does the payment drop enough? Use the estimator to see if the reduction clears $50 a month.
How long will you stay? Compare the break-even with your plans, as with any refinance.
Compare other paths. A conventional or FHA refinance is a separate loan with its own qualifying rules.
USDA streamline FAQ
Does my home need a new appraisal?
Often not for a streamlined assist refinance, though the lender sets the final requirements.
Can I use this to leave USDA for another loan?
That is a different refinance. The streamline stays within USDA. A conventional or FHA refinance has its own qualifying rules.
What if my payment only drops a little?
The program generally needs at least $50 a month. The estimator checks that against your inputs.
Is there a waiting period?
Typically the existing loan needs to have been in place for about a year, but confirm with your lender.
Do the fees go into the loan?
The upfront guarantee fee can generally be financed. Ask for an itemized estimate.
Duane Buziak, NMLS #1110647. Licensed in VA, FL, TN, GA, NC, SC, MD, DC, WV, TX and KY. Brokered through Coast2Coast Mortgage, NMLS #376205. Verify licenses at nmlsconsumeraccess.org. For illustration only. Not a loan offer, commitment or rate quote. Equal Housing Opportunity.
