Many times I am asked "how much in fees is normal when doing an FHA Streamline?" and my answer is "it depends".
How much is normal?
Let's start with the idea that nobody works for free. Banks don’t work for free, title companies don’t work for free, the government doesn’t work for free - and all of these entities are involved when you refinance your house.
The key when doing an FHA streamline is to know exactly who is going to pay the fees on the loan - you or the bank.
If you are going to be the one who is paying, then it is possible to be able to roll them into your loan so that you have “no out of pocket closing costs” - which is different than “no closing costs”.
If the bank is going to pay the fees for your FHA streamline then it would be a true “no closing costs” loan. The bank will usually agree to a "no closing costs" loan in exchange for a slightly higher interest rate.
Depending on your situation, it may make sense to pay your closing costs in some cases and in others, it may make sense to have the bank agree to pay the closing costs. Usually, the best indicator of which is better is how long you want to stay in the loan. The shorter the period of time, the more sense it makes for the bank to pay them. The longer the timeframe, the more sense it makes for you to pay them.