The VA home loan refinancing program offers qualifying homeowners an easy option to take advantage of reduced interest rates and cut their monthly mortgage payments. Aside from that, veteran and military homeowners can receive cash back on a VA refinancing and use the money for a number of purposes, including debt repayment and property upgrades, among others
With mortgage interest rates falling below 7% for the first time since August, the current economic situation presents an excellent opportunity for many military homeowners to take advantage of the multiple benefits of a VA refinancing.
To get started, call 1-916-548-3942 or get a VA Refinance quotation online .
VA borrowers can refinance to a reduced rate through two primary programs: the VA Streamline Refinance, often known as the Interest Rate Reduction Refinance Loan (IRRRL), and the VA Cash-Out Refinance.
| VA Streamline (IRRRL) Refinance | Cash-Out Refinance |
| Often called a "Streamline" refinance, the Interest Rate Reduction Refinance Loan (IRRRL) option is great for existing VA Loan holders who are looking to realize significant savings and take advantage of lower interest rates. More on IRRRL VA Refinancing |
A "Cash-Out" refinance is an option for those with a VA or conventional loan looking to take advantage of their home's equity to access cash for home improvements, emergencies, pay off debt, or any other purpose. More on Cash-Out Refinancing |
Thinking about refinancing? Speak with a home loan consultant to begin your VA loan to discuss your options.
A Streamline refinancing allows Veterans with existing VA loans to refinance into a lower interest rate, lowering monthly mortgage payments. Streamline refinancing loans have minimum paperwork and typically cost little to nothing out of pocket. Borrowers might include closing fees in their total loan amount. Some homeowners can get a Streamline refinancing without an appraisal.
The other common alternative, known as a Cash-Out refinancing, allows borrowers to access their home’s equity and spend it as cash. This form of refinance is available to all qualifying veteran homeowners, regardless of whether they hold an FHA, USDA, or conventional loan.
Refinancing may result in increased financing costs throughout the course of the loan.
It’s easy to continue right where you left off!
The eligibility requirements for a VA Refinance are identical to those for a VA Home Purchase Loan.
Typically, you can qualify if you were in active duty for more than 90 consecutive days during a war or more than 181 days during peacetime.
For National Guard and Reservists, the Veteran must have served for at least six years, or 90 days, under Title 32 orders, 30 of which must be consecutive.
Some surviving spouses of veterans who died in duty or suffered a military-related disability may also be eligible.
The two VA refinancing loan alternatives have distinct standards and restrictions. Lenders can also set their own requirements, which may include credit score, debt-to-income ratio, and other factors.
Veteran homeowners may not be required to fulfill a credit score standard or debt-and-income restrictions when refinancing via VA Streamline. When it comes to credit underwriting, VA Cash-Out refinances often appear quite similar to a conventional VA purchase loan, including fulfilling a lender’s credit score minimum, DTI ratio standards, and other requirements.
There are also certain conditions for each refinancing loan in terms of how quickly you may refinance and the benefits you will receive.
For further information, see the VA Streamline and Cash-Out criteria.
Generally, you cannot refinance until 210 days after the first mortgage payment was due, and you must have made at least 6 monthly on-time payments.
Seasoning criteria for VA refinancing loans may differ per lender. SDVA Homes now requires seven monthly payments and a minimum 240-day seasoning time.
There are several benefits to refinancing with a VA loan. Here are some of the main advantages:
1. Lower interest rates: VA refinancing frequently offers lower interest rates than traditional refinancing, which can result in considerable savings over the course of the loan.
2. No private mortgage insurance (PMI): VA loans do not need PMI, even if the homeowner refinances for more than 80% of the property’s value. This can lead to significant monthly savings.
4. Flexible credit standards: VA refinancing often has less credit requirements than other refinancing choices, making it more accessible to veterans with less-than-perfect credit ratings.
5. No prepayment penalties: VA loans offer no prepayment penalties, which allow borrowers to pay down their mortgage early without incurring additional expenses.
These advantages make VA refinancing an appealing alternative for individuals who qualify, giving financial rewards and flexibility that are not necessarily available in traditional refinancing.
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