What Are The Benefits Of A VA Loan When Refinancing?

Interest benefits you should consider when using a VA loan when refinancing.

The type of VA loan you should consider depends on your situation. There are three types of VA loans available to veterans who are considering refinancing and all have specific benefits to veterans. Veterans seeking lower interest rates, cash or switching from a conventional to a VA loan should consider the following.

VA Streamline Refinance

The VA streamline refinance is an option available to veterans who already have a VA loan but are looking to lower their interest rate. The benefits of this option is that it requires no out-of-pocket expenses. An appraisal is not required. And, it doesn’t require income verification or a credit check. There are also no maximum amounts and there are no monthly mortgage insurance premiums. The funding fee is 5% on all interest reductions for this option.

Cash Out Refinance

A veteran who already has a VA loan can take up to 90% of the homes value once equity has been built up. This cash can then be used to pay off debts, make home improvements and for various other items.

Conventional to VA Refinance

A conventional to VA refinance allows a veteran who currently does not have a VA loan to refinance into a VA loan from a conventional loan. There is a funding fee of 2.2% for veterans electing to use this option. This amount can be financed so that the veteran doesn’t have to pay the amount all at one time. A benefit of using this type of VA loan when refinancing is that monthly payments will be lower because there is no monthly mortgage insurance premiums to be paid. Another great benefit with this option is that there is no credit check required. Therefore, a veteran with less than perfect credit may still qualify for low interest rates regardless of past credit problems.

What Are The Benefits Of A VA Loan When Refinancing?

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