What to know about a VA Streamline Refinance Loan is that this loan, without a doubt, is known as the best refinance loan on the market. Its simplicity and easy qualification process allows those with existing VA Loans the opportunity to refinance with a lower interest rate.
There is no need for good credit, as there are no credit checks. Essentially, anyone who already has a VA loan can apply and become eligible for a new loan. Job verification, proof of income and appraisals are not asked for as well, making the process even less painful.
Because of the drop in mortgage rates, as well as VA loan rates; there could not be a better time to refinance than now. Current holders of adjustable rate VA mortgages can take advantage of an opportunity like this to refinance their home into a permanent, low fixed-rate.
Veterans can feel good to know that they will not have to pay any money down or any up front expenses with an IRRRL, also known as an Interest Rate Reduction Refinance Loan. Additional costs that incur can be included in the new loan or by the lender absorbing them by raising the interest rate slightly. The new loan must have a lower interest rate than that of the old loan, making this the one and only requirement.
Although there is no cash out policy with a streamline request loan of this nature, there is an allowance of $6,000 for energy efficient improvements. Since the new loan balance cannot be higher than the old loan balance, other costs and fees, such as the VA funding fee, closing costs and up to 2 discount points, can be allowed in the balance of the new loan.
Many Lenders will try to convince borrowers to use their services by saying they are the only IRRRL Lenders who do such loans. This is not true, as any Lender is able to do this for a willing Veteran who wants the loan. One should do extensive research, however, to make sure terms and conditions are what is needed in their situation. Different Lenders may have different terms.
In offering IRRRLs, some lenders may give the opportunity for one to reduce their loan from a term of 30 to 15 years. While this can be known to save a lot of money in interest over the life of the loan, monthly payments can increase a good bit if the interest rate is not at least one or two percent and lots of new loans costs aren’t included in the new loan.
Another perk for Veterans wishing to refinance using this type of loan is that the transition period is made easier by allowing the borrower to forgo 2 payments on their home. Their escrow account can be refunded 30 days after closing, giving an extra added benefit to the already long list.
In short, one should remember that a streamline refinance loan is the perfect vehicle in which a person can have their mortgage interest rates lowered, allowing them to save money in the long run. It is worth the time and effort that one puts in to finding the appropriate lender for their streamline request.
Looking for great va mortgage rates? Make sure you ask plenty of questions about the lender you are going to do your loan with. Anyone can quote low va loan rates but delivering them is what makes a company great!
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