If you are currently serving in the US Armed Forces or are a Veteran you probably qualify for the VA loan guarantee. The VA loan guarantee gives you access to VA loan benefits which include zero down home loans and financing with today’s low interest rates. A traditional lender (your bank, credit union, mortgage broker) issues you the loan but the government insures a portion of the balance against default.
If you already have a VA home loan now is a fantastic time to use the VA streamline refinance program to lower your interest rate and save money on a monthly basis. The Interest Rate Reduction Refinance Loan (IRRRL) is the most popular VA loan. Since it is a streamline loan program an experienced mortgage lender can complete these refinances in around 30 days. The VA already has your loan information on file including data on your home. This makes the process much faster. An added benefit of the VA streamline refinance is that the closing cost can be rolled into the loan. At times the mortgage lender can even cover the majority of the fees by simply charging a higher interest rate.
VA Streamline Refinance Requirements (IRRRL)
• The new monthly mortgage payment has to be less than the old monthly mortgage payment. In other words if refinancing will make you pay the same or more you can not use the IRRRL. The only exception is if you are refinancing from an adjustable rate mortgage (ARM) to a fixed interest rate loan.
• No cash out. This loan can pay off your existing one but does not work for borrowers looking to use their homes equity for other things.
• You have to certify that you occupied the property.
• This is a VA to VA refinance, meaning you used your VA guarantee for the current home loan.
• Pay on time. Your home loan must be current with no more than one 30 day late payment in the previous twelve months.
Streamline refinances are a great option for borrowers wanting to take advantage of the current low home mortgage interest rates. They are at historic lows right now and home values are simultaneously on the rise. There is no guarantee that rates will stay at these low levels so if you own a home do not risk waiting to refinance. Take advantage of a streamline refinance to lower your mortgage interest rate and your monthly bills.
Refinancing can save you hundreds or thousands a year. For example if you currently owe $320,000 of a $340,000 on a 30 year mortgage term at 6.25% has a principal and interest payment of $2,093 per month. If you refinanced that loan today your interest rate could be only 3.75% for a monthly principal and interest payment of $1,481. With a savings of $600 a month the family in this example would save $7,200 in the first year alone. Speak with an experienced mortgage banker today to see if the VA streamline refinance is right for you. There are many refinance programs available right now that can help you and your family save money. Act now before interest rates rise.
