How to Remove a Co-Borrower on an FHA Streamline Refinance
The only way to completely remove a co-borrower's name from an FHA streamline refinance is to apply for a new FHA streamline refinance mortgage. You may be required to apply for a credit qualifying (verses a non-credit qualifying refinance) FHA streamline refinance to show that you can afford the mortgage without using the co-borrower's credit and income. The Federal Housing Administration website advises that an FHA streamline refinance loan can only be made when the home is owner-occupied or when a second home qualifies under the specific U.S. Department of Housing and Urban Development (HUD) rules.
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Things You'll Need
- Quitclaim deed signed by co-borrower
- Copies of six months of mortgage payments
- One month's worth of paycheck stubs
- Two years' worth of W-2 forms and/or tax returns
- Current mortgage statement
- Copy of your homeowners insurance policy
- Copy of your driver's license and Social Security card
Instructions
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1
Ask the co-borrower to sign and execute a quitclaim deed at least six months in advance of applying for your new FHA streamline refinance mortgage. Have the quitclaim deed recorded by your county recorder or register of deeds to establish the date of the quitclaim deed.
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2
Make at least six months of mortgage payments once the quitclaim deed has been executed.
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3
Copy all of your canceled checks or bank withdrawals to prove that you made six mortgage payments on your own. You will need to supply copies of these payments to your FHA mortgage lender.
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4
Make an appointment with an approved FHA mortgage lender.
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Fill out the FHA streamline refinance application and supply all necessary financial information such as your paycheck stubs, W-2 forms, current mortgage statement and tax returns to your FHA lender. You may also need to provide your homeowners insurance policy and copies of your driver's license and Social Security card.
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Read your FHA streamline refinance closing documents carefully to be sure the co-borrower's name has been removed.
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Check your deed recording at your local court house to be sure the deed was correctly recorded in your name.
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Tips & Warnings
If you are removing a co-borrower's name due to a divorce, you must supply a copy of your divorce decree to the FHA mortgage lender.
Deed recordings can take several months to be recorded at the court house after the date of your FHA streamline refinance closing.
