When you think about it, a VA refinance could make sense. If you are a veteran, you understand the advantages of owning a home. You know that there are many advantages and disadvantages to owning a home, which means that you probably would not be alone in wanting to take advantage of the home loan refinance that is available through the Veterans Administration. However, you should understand that there are a variety of reasons why a VA refinance is a smart financial move. This article will give you the reasons you should think about a VA refinance.
A lot of people prefer to get lower rates on VA home loans compared to what they would get from a regular loan. The VA money-out refinancing program allows active-duty and veteran service members to borrow s asset-based capital, which can amount to thousands of dollars. The concept of getting money out of your house is enticing, but is it a smart idea for you? The good news is that you can get lower rates when you consolidate your multiple lender’s loans into one loan type.
To qualify for a VA refinance, you should have a higher credit score than the value of the house that you currently own. This will help ensure that you qualify for the best deal and the lowest interest rates possible. To see if you do qualify, consult with an accredited lender near you or visit the website of the federal Office of Housing and Urban Development. This will give you information on what lender to use for the VA loan, as well as helpful tools to help you figure out how much money you will need to borrow.
To qualify for the VA refinance, homeowners must demonstrate a stable income, as well as having a decent to low mortgage insurance rate. Typically, the qualifying interest rate is around 3%, which is considerably lower than the average rate offered by traditional lenders. This type of refinancing is also not considered a mainstream loan, which means that borrowers will not be issued a Federal Housing Administration loan or FHA insurance guarantee. However, if you need one, the terms and conditions are very different. You will still need to pass all of the lender’s underwriting requirements and provide financial documents, including a complete financial statement, credit history, and your most recent tax returns.
Although you may feel skeptical about these special deals, there are several valid reasons to consider them. First, military personnel and their family members often face difficult financial times. If you are experiencing financial difficulties or other problems, a VA refinance could help you catch up and stay current on your mortgage payments.
Second, since these financing plans do not require a cosigner, they offer the benefits of being able to finance a home loan without having to rely on outside financing. Third, in some cases, federal government home loans or VA home loans are tied into larger housing loans for students, which can be helpful if you want to pay for your education. And fourth, if you belong to a professional organization or trade organization, this type of loan can help you pay for certain professional services, such as accounting, legal, or mortgage works.
Once you have decided to apply for a VA refinance, you will need to decide when you would like to schedule your loan opening and closing. If you plan to start early in the new year, you can get a better interest rate and have the transaction completed before the New Year begins.
If you are planning to close sometime in the New Year, you should schedule the closing two months ahead of schedule. Regardless of the time of year you choose, both types of closings will allow you to see exactly how much money you will save once you take out a new mortgage loan, including any points, closing costs, and/or refinancing fees associated with the transaction.
