Essentially, the $6000 needs to be parceled out from the escrow account as the contractor invoices the completed projects. This process is known as a contractor “draw” from escrow.
This cumbersome process can add months to closing your “streamline” refinance! It can seriously delay the process of getting a lower interest rate, while you fret over the extra $6000. The significant delay can also create havoc with the rate locking strategy for the lender. Your opportunity for a lower rate could actually disappear, should rates rise during the extra time involved to fund the EEM streamline refinance. Most loans are locked for only fifteen, thirty, even sixty days at the very longest, and it can take that long, PLUS sixty days, to make sure that you qualify the EEM job by getting your bids, submitting them, qualifying the contractor, getting the approval, etc.
The EEM IRRRL or EEM streamline refinance is something that is advertised, but it is rarely taken advantage of due to all the hoops that you have to jump through to utilize the additional $6.000. Therefore, very few lenders seriously offer it on their menu of loan products.