VA Refinance Loans For Conventional, FHA, Sub-Prime and Existing VA Mortgages | VA Loan News Blog

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VA Refinance Loans For Conventional, FHA, Sub-Prime and Existing VA Mortgages | VA Loan News Blog.

VA Refinance Loans For Conventional, FHA, Sub-Prime and Existing VA Mortgages | VA Loan News Blog

But do you know which VA loan option works for you in your situation? Can a Fannie or Freddie loan be refinanced as a VA mortgage, or can a conventional loan qualify for VA streamline refinancing?

There are several options for VA refinance loans. Borrowers who want to get cash back on the refinancing deal, regardless of the type of mortgage being refinanced must explore their VA Cash-Out Refinancing loan options. These loans are appraisal required and also require credit underwriting, which means you’ll be required to submit a credit application much like your original home loan.

Cash out for VA refinancing is not available for VA Streamline Loans, and the VA home loan program does not offer personal loans–borrowers who want cash back should apply for VA Cash-Out and expect the amount of the cash back to be calculated once the original mortgage has been paid off, plus the amount of any included/financed fees or points. VA loan rules permit any type of mortgage loan to be refinanced with a VA Cash-Out Refinance loan.

VA Streamline Refinancing, on the other hand, is aimed specifically at those who have existing VA loans. This type of VA refinance loan is meant to lower the payment and/or interest rate on the mortgage–in fact, there’s a requirement that this happens in most cases. Borrowers who include extras into the Streamline Loan such as the VA Energy Efficient Mortgage (EEM) Option may find their payments higher on the new loan. This can be allowed under the right circumstances, but if your payments increase by more than 20% you will be required to submit a credit application.

These options may or may not be right for you depending on your financial goals and needs. The best way to determine what’s right for you may include a chat with a loan officer about the VA EEM and the inclusion of the VA loan funding fee into the loan amount where applicable.

The VA Certificate Of Eligibility

 

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VA Refinance Loans For Conventional, FHA, Sub-Prime and Existing VA Mortgages | VA Loan News Blog

the first requirements in the VA loan application process is that the borrower must show he or she is eligible for a VA guaranteed home loan. This is done by presenting the lender with a VA certificate of eligibility (COE), or asking the lender’s help in obtaining one.

Borrowers are free to request their own VA COE, which can be done online. The VA official site says the following about getting your COE online:

“To get your Certificate of Eligibility (COE) online, please go to the eBenefits portal. If you already have login credentials, click the Login box, and if you need login credentials, please click the Register box and follow the directions on the screen.  If you need any assistance please call the eBenefits Help Desk at 1-800-983-0937.  Their hours are Monday-Friday, 8am to 8pm EST.”

Borrowers may need to attach electronic copies of their DD Form 214 or evidence of their current military service status as part of the application form.

If you prefer to get your VA COE with the help of a lender, be ready to show required proof of military service including current military orders or a copy of your DD Form 214 report of discharge. You may also need to provide Social Security data or a copy of your Social Security card and other information.

You can also apply for a COE by mail–you’ll need to submit VA Form 26-1880, Request for Certificate of Eligibility  and any required additional paperwork to theDepartment of Veterans Affairs. Call them at 1-800-827-1000 to get the current mailing address for COE requests. Some applicants–surviving spouses of military members who died from a service-connected disability, for example–are required to apply by mail.

VA Refinance Loans For Conventional, FHA, Sub-Prime and Existing VA Mortgages | VA Loan News Blog

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WHAT IS A VA-GUARANTEED LOAN?

 

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WHAT IS A VA-GUARANTEED LOAN?

 
A VA-guaranteed loan can be used to:
 buy a home, either existing or pre-construction, as a primary residence
 refinance an existing loan
BENEFITS OF A VA-GUARANTEED LOAN:
 Equal opportunity for all qualified Veterans to obtain a VA loan
 Reusable
 No downpayment (unless required by the lender or the purchase price is more than the
reasonable value of the property)
 No mortgage insurance
 One time VA funding fee that can be included in the loan
 Veterans receiving VA disability compensation are exempt from the VA funding fee
 VA limits certain closing costs a Veteran can pay
 Can be assumed by qualified persons
 Minimum property requirements to ensure the property is safe, sanitary, and sound
 VA staff dedicated to assisting Veterans who become delinquent on their loan
WHO IS ELIGIBLE?
Generally, the following people are eligible:
 Veterans who meet length of service requirements
 Servicemembers on active duty who have served a minimum period
 Certain Reservists and National Guard members
 Certain surviving spouses of deceased Veterans
Note: There are other groups of individuals who may be eligible. To determine your eligibility, check
eBenefits at www.ebenefits.va.gov, or contact VA Eligibility Center at 1-888-768-2132.
DisabilitiesdeterminedbyVAtoberelatedtoyourmilitaryservicecanleadtomonthlynon‐taxablecompensation,enrollmentinthe
VAhealthcaresystem,a10‐pointhiringpreferenceforfederalemployment andotherimportantbenefits.AskyourVA
representativeorVeteransServiceOrganizationrepresentativeaboutDisabilityCompensation,Pension,HealthCare,Caregiver
Program,CareerServices,EducationalAssistance,HomeLoanGuaranty,Insuranceand/orDependentsandSurvivors’BenefitsKEY UNDERWRITING CRITERIA:
 No maximum debt ratio; however lender must provide compensating factors if total debt ratio
over 41%.
 No maximum loan amount; however, VA does limit its guaranty; Veterans can borrow up to
$417,000 without a downpayment in most of the country. Find out the limit in any county by
visiting: www.benefits.va.gov/homeloans/.
 Published residual income guidelines to ensure Veterans have the capacity to repay their
obligations while accounting for all living expenses.
 No minimum credit score requirement; instead VA requires a lender to review the entire loan
profile to make a lending decision.
 Complete VA credit guidelines are published at www.benefits.va.gov/warms/pam26_7.asp .
HOW DO I START THE PROCESS?
VA provides policy, guidelines and oversight of the program. Lenders provide financing for eligible
Veterans. The guaranty allows Veterans to obtain a competitive loan without a downpayment. Lenders
need a Certificate of Eligibility (COE) to prove your entitlement. Most Veterans can obtain the COE
online through eBenefits (www.ebenefits.va.gov). Lenders also have the ability to request the COE on
your behalf.
VA encourages prospective buyers to talk to several lenders to find one that fits their needs, knows the
VA loan program, and offers competitive rates and terms.
Note: The VA appraisal is not intended to be an “inspection” of the property.
A Veteran should get expert advice from a qualified residential inspection service before
legally committing to a purchase agreement. Veterans are also encouraged to have radon
testing performed.
CAN VA HELP IF I’M HAVING TROUBLE MAKING PAYMENTS ON MY
EXISTING LOAN?
VA Loan Technicians are trained to help Veteran borrowers retain their homes and avoid foreclosure.
Please call toll-free 1-877-827-3702 to speak to a VA Loan Technician.
For More Information, visit Our Web Site at www.benefits.va.gov/homeloans/.