• There are two ways to refinance an FHA mortgage.house image by Cora Reed from Fotolia.com
  
  An FHA loan is a mortgage made by a private institution but guaranteed by the Federal Housing Administration (FHA), which is a branch of the U.S. Department of Housing and Urban Development (HUD). FHA loans provide benefits to borrowers, including low down payment requirements and reduced interest rates. The FHA also makes it easy to refinance.
  
  

Options

• There are two ways to refinance an FHA loan. But with either option, you must be certain that the original loan was guaranteed by the FHA. You cannot refinance a loan through the FHA that was not originally an FHA loan. If you have an FHA loan, you can do either a standard refinance or a streamline refinance.
  
  

Standard Refinance

• A standard refinance means you refinance with a private loan that is not guaranteed by the FHA. You replace your current FHA loan with a new private loan that is not an FHA loan. This might make sense if you want to take advantage of low interest rates. The details of a standard refinance vary according to the loans issued by various private lenders.
  
  

Streamline

• The most common, and simplest, type of FHA refinance is the streamline. Streamline means refinancing an FHA loan with a new FHA loan. It requires little paperwork or evaluation. The loan application used to obtain the current FHA loan is resubmitted when you apply for a streamline refinance. You do not have to provide a new credit report, prove your income again (though you may have to prove that you are still employed), and most importantly, you don't have to obtain new approval. An FHA streamline reduces your interest rate with minimal effort. The only guideline for obtaining a streamline is that your original loan was FHA.