Not only does the VA Home Loan program provide veterans with a fantastic chance to own a home, but it also provides qualified homeowners with a simple way to take advantage of lower rates and decrease their monthly mortgage payment. Want to take VA loan refinancing a step further? The program also allows military homeowners to receive cash back on a VA refinance and use that money toward things like like off debt, making home improvements, and much more. With the current housing climate the way it is right now is a good time for military homeowners to take advantage of the many benefits found in a VA loan refinance.
There are two main programs that help military homeowners refinance into a lower rate. These two main options are the VA Streamline Refinance, also known as the Interest Rate Reduction Refinance Loan (IRRRL), and the VA Cash-Out Refinance.
VA Streamline (IRRRL) Refinance
In 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.
This is a great option for those that have a VA or conventional loan and are looking to take advantage of their home’s equity to access cash for home improvements, emergencies, pay off debt, or any other purpose.
We dive into more detail about each VA loan refinancing option, but as a quick overview a Streamline Refinance allows veterans who already have a VA Loan to refinance into a lower interest rate, which also reduces monthly mortgage costs. Streamline refinance loans feature very little paperwork (which is always a bonus) and more often than not require little-to-no out of pocket costs. Borrowers are able to roll closing costs into their overall loan amount. Some homeowners may also be able to secure a Streamline refinance without an appraisal.
The other popular option, known as the Cash-Out Refinance, allows borrowers to dive into their home’s equity and use it as cash. This type of refinance is available to any qualified veteran homeowner, regardless of whether they have a FHA, USDA or conventional loan. This makes it an attractive refinancing option, as the type of originating loan doesn’t matter.
Many military homeowners are taking advantage of the numerous benefits found in a VA loan refinance.