USDA Streamlined Refinancing

AAA

DEFINITION of 'USDA Streamlined Refinancing'

A mortgage-refinancing option offered by the United States Department of Agriculture (USDA). USDA streamlined refinancing is available to homeowners who purchased their home using a Section 502 loan, which is a loan available to low-income individuals and households in rural areas. The refinancing option is available in all U.S. states and territories.

INVESTOPEDIA EXPLAINS 'USDA Streamlined Refinancing'

USDA streamlined refinancing is for a fixed-rate loan with a 30-year term. The interest rate must be lower than the interest rate of the loan being refinanced. The USDA does not require an appraisal on a streamline refinance, but does require a credit report to be available.

The property being refinanced must be the borrower’s primary residence, but does not have to be located in a currently eligible rural area. Homeowners do not qualify if they are refinancing a loan offered by the FHA, VA, Fannie Mae or Freddie Mac.

The phrase “streamline refinance” refers to the reduced amount of paperwork and underwriting that the lenders must work with.

RELATED TERMS
  1. Forbearance

    A temporary postponement of mortgage payments.
  2. Mortgage Modification

    A permanent change in a homeowner's home loan terms that makes ...
  3. USDA Non-Streamlined Refinancing

    A mortgage-refinancing option offered by the United States Department ...
  4. No-Appraisal Mortgage

    A type of home loan used for refinancing for which the lender ...
  5. No-Appraisal Refinancing

    A type of mortgage for which the lender does not require an independent, ...
  6. No-Appraisal Loan

    A mortgage that does not require an appraisal of the property’s ...
Related Articles
  1. 4 Overlooked Homeownership Costs
    Home & Auto

    4 Overlooked Homeownership Costs

  2. Foreclosure Opens Doors For Real Estate ...
    Home & Auto

    Foreclosure Opens Doors For Real Estate ...

  3. Top 6 Mortgage Mistakes
    Home & Auto

    Top 6 Mortgage Mistakes

  4. Fannie Mae: What It Does And How It ...
    Investing Basics

    Fannie Mae: What It Does And How It ...

comments powered by Disqus
Hot Definitions
  1. Market Segmentation

    A marketing term referring to the aggregating of prospective buyers into groups (segments) that have common needs and will ...
  2. Effective Annual Interest Rate

    An investment's annual rate of interest when compounding occurs more often than once a year. Calculated as the following: ...
  3. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  4. Odious Debt

    Money borrowed by one country from another country and then misappropriated by national rulers. A nation's debt becomes odious ...
  5. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  6. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
Trading Center