The VA home loan has been helping veterans since 1944. It is the government’s way of giving thanks to the brave veterans and members of the armed forces. VA does not offer the loan, but it makes home loan application easy to borrowers. It guarantees the loan, which means that if the borrower defaults in payment, the Veterans Administration will repay the loan to the lender. Later on, the loan expanded in the form of VA loan refinancing.
When refinancing a VA loan, you no longer need to submit a certificate of eligibility. However, there are a few things you need to remember and these are the following:
- Loan limits – The VA home loan program has a particular limit, and it varies depending on where area you live. Lenders approve up to four times of the basic entitlement amount without requiring a down payment.
- Funding Fee – The VA Guaranteed Loan Program requires a funding fee and should be paid upon closing on the loan. You have the option to pay the funding fee in cash or just roll it into your loan. The usual funding fee ranges from .5% to 3.3%. However, if you refinance a VA loan, the funding fee is higher. There is an exception to the rule. You will not be required to pay a funding fee if you are a veteran with a disability or a surviving spouse.
- IRRRL (Interest Rate Reduction Refinance Loan) – It allows you to refinance up to 100% of the value of your home. You have to show the lender that you previously occupy the property. The downside of this program is that you will not be able to use it to pay off the second mortgage.
- Cash-Out Refinance Loan – You can obtain cash through cash-out refinance loan. You can use the money to finance other expenses such as medical cost, education, home improvement, and the likes. You can refinance up to 100% of the total value of the property. There are certain requirements you should meet such as credit report, property appraisal, and income verification. You have to prove to the lender that you are an occupant of the home being refinanced.
If you want to apply for a VA home loan or wanting to refinance your existing VA loan, then contact Freedom Mortgage Corporation. It is a VA-approved lender known for its unique streamline process and client-friendly service. For the details on how to take out a home loan from Freedom Mortgage, just click this link https://www.freedomspg.com/.
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