Qualifying veterans and active-duty service members that currently have a VA home loan will be able to qualify for a VA home loan refinance. This is a great option to take advantage of lower interest rates or to have access to cash through the program that is completed in a simple and streamlined process.
The Interest Rate Reduction Refinance Loan
The VA offers two different options with their VA home loan refinance program. The more traditional option is the interest rate reduction refinance loan or more simply the IRRRL.
This is not a cash loan option; rather it is used by current VA home loan holders to reduce interest rates. With the reduced interest rates, there will be lower monthly payments as well as lower payments over the term of the loan on total interest.
As the refinance is on a home with a current VA loan, there is very limited paperwork required. Often this can be completed without the need for a home appraisal or survey and just requires identification, disclosures, and proof of homeowners’ insurance to complete the process.
Cash-Out Refinance
With the cash-out VA home loan refinance the homeowner is interested in a cash payment from the home. This cash is then used in any way the homeowner desires, often to make improvements, pay bills or make other major purchases.
As with the IRRRL, this type of VA loan refinance will also result in a lower interest rate. This option will require documentation, like the IRRRL, but it will require a home appraisal to determine the actual value of the home and property to establish the cash-out amount offered.
Both options through the VA home loan program allows for all costs associated with the refinancing option selected to be rolled-over into the loan total and paid off over time with the fixed monthly mortgage payments.
To discuss your options or to ask about the VA home loan refinance offered through Guaranteed Rate, give us a call today.
