VA Refinance Loans: VA Guidelines And Benefits On Refinancing

This Article Is About VA Refinance Loans:  VA loans are the best loan program in the United States. VA loans have the lowest mortgage rates than any other government and/or conventional loan. However, only eligible veteran borrowers can qualify for VA loans. There are countless benefits of VA refinance loans during today’s booming housing market with historic low rates. In this article, we will discuss and cover VA Refinance Loans and using VA loans to refinance in today’s hot housing market.

General Guidelines On VA Refinance Loans

In‌ ‌today’s‌ ‌crazy‌ ‌mortgage‌ ‌market,‌ ‌we‌ ‌are‌ ‌receiving‌ ‌more‌ ‌and‌ ‌more‌ ‌phone‌ ‌calls‌ ‌from‌ ‌our‌ ‌nation’s‌‌ veterans‌ ‌inquiring‌ ‌about‌ ‌refinancing ‌guidelines.‌ ‌This‌ ‌is‌ ‌a‌ ‌great‌ ‌time‌ ‌for‌ ‌a‌ ‌veteran‌ ‌to‌ ‌complete‌ ‌a‌refinance‌ ‌transaction.‌ ‌Most‌ ‌calls‌ ‌we‌ ‌receive‌ ‌are‌ ‌questions‌ ‌regarding‌ ‌the‌ ‌VA‌ ‌interest‌ ‌rate‌reduction‌ ‌refinancing‌ ‌loan‌ ‌(IRRRL)‌ ‌as‌ ‌well‌ ‌as‌ ‌VA‌ ‌cash-out ‌refinance‌ ‌guideline‌ ‌questions.‌ ‌Gustan‌ ‌Cho‌ ‌Associates‌ ‌are‌ ‌experts‌ ‌in‌ ‌VA‌ ‌mortgage‌ ‌financing.‌ ‌In‌ ‌this‌ ‌blog‌, ‌we‌ ‌will‌ ‌detail‌ ‌a‌ ‌few‌guidelines‌ ‌for‌ ‌VA‌ ‌refinancing‌ ‌and‌ ‌how‌ ‌to‌ ‌apply‌ ‌for‌ ‌a‌ ‌VA‌ ‌refinance‌ ‌with‌ ‌our‌ ‌team.‌

What Are VA Refinance Loans

First,‌ ‌let‌ ‌us‌ ‌understand‌ ‌a‌ ‌few‌ ‌basics.‌ ‌What‌ ‌is‌ ‌a‌ ‌VA‌ ‌refinance?‌ ‌ A‌ ‌VA‌ ‌refinance‌ ‌can‌ ‌be‌ ‌many‌‌ different‌ ‌things.‌ ‌The‌ ‌basic‌ ‌definition‌ ‌is‌ ‌a‌ ‌VA‌ ‌refinance‌ ‌means‌ ‌you‌ ‌pay‌ ‌off‌ ‌your‌ ‌current‌ ‌mortgage‌and‌ ‌start‌ ‌a‌ ‌new‌ ‌VA‌ ‌mortgage‌ ‌loan.‌ ‌There‌ ‌are‌ ‌a‌ ‌few‌ ‌different‌ ‌transaction‌ ‌types‌ ‌available.‌ ‌You‌ ‌can‌complete‌ ‌a‌ ‌rate‌ ‌and‌ ‌term‌ ‌refinance,‌ ‌cash-out ‌refinance,‌ ‌or‌ ‌an‌ ‌interest‌ ‌rate‌ ‌reduction‌ ‌refinancing‌ loan.‌

Rate And Term VA Refinance Loans

A‌ ‌rate‌ ‌and‌ ‌term‌ ‌refinance‌ ‌will‌ ‌simply‌ ‌re-cast‌ ‌your‌ ‌current‌ ‌mortgage‌ ‌into‌ ‌new‌ ‌terms.‌ ‌Meaning‌you‌ ‌may‌ ‌move‌ ‌up‌ ‌from‌ ‌a‌ ‌30‌ ‌year‌ ‌fixed‌ ‌mortgage‌ ‌to‌ ‌a‌ ‌15‌ ‌year‌ ‌fixed‌ ‌mortgage.‌ ‌You‌ ‌may‌ ‌also‌move‌ ‌back‌ ‌in‌ ‌term‌ ‌and‌ ‌restart‌ ‌a‌ ‌30-year ‌mortgage‌ ‌to‌ ‌lower‌ ‌your‌ ‌overall‌ ‌monthly‌ ‌payment.‌ ‌A‌ ‌VA‌rate‌ ‌and‌ ‌term‌ ‌refinance‌ ‌is‌ ‌not‌ ‌a‌ ‌very‌ ‌common‌ ‌type‌ ‌of‌ ‌transaction.‌ ‌But‌ ‌it‌ ‌is‌ ‌a‌ ‌great‌ ‌opportunity‌ ‌to‌save‌ ‌money‌ ‌with‌ ‌today’s‌ ‌historically‌ ‌low-interest ‌rates.‌

V‌A Cash-Out Refinance Mortgages

V‌A Cash-Out Refinance Mortgages

VA‌ ‌cash-out ‌refinancing‌ ‌is‌ ‌a‌ ‌very‌ ‌popular‌ ‌mortgage‌ ‌program.‌ ‌This‌ ‌allows‌ ‌a‌ ‌veteran‌ ‌to‌ ‌utilize‌ ‌the‌equity‌ ‌in‌ ‌their‌ ‌home‌ ‌for‌ ‌other‌ ‌purposes‌ ‌such‌ ‌as‌ ‌paying‌ ‌off‌ ‌debt,‌ ‌home‌ ‌improvements,‌ ‌or‌investment‌ ‌opportunities.‌ ‌A‌ ‌veteran‌ ‌is‌ ‌entitled‌ ‌to‌ ‌all‌ ‌the‌ ‌equity‌ ‌in‌ ‌their‌ ‌home‌ ‌and‌ ‌can‌ ‌cash‌ ‌out‌ ‌up‌to‌ ‌100%‌ ‌of‌ ‌the‌ ‌value‌ ‌of‌ ‌their‌ ‌property.‌ ‌
Many‌ ‌lending‌ ‌institutions‌ ‌will‌ ‌only‌ ‌allow‌ ‌a‌ ‌veteran‌ ‌to‌utilize‌ ‌a‌ ‌cash-out ‌transaction‌ ‌up‌ ‌to‌ ‌90%‌ ‌loan‌ ‌to‌ ‌value.‌ ‌However,‌ ‌that‌ ‌is‌ ‌an‌ ‌overlay‌ ‌and‌ ‌not‌ ‌a‌ guideline.‌ ‌Please‌ ‌keep‌ ‌in‌ ‌mind‌ ‌if‌ ‌you‌ ‌are‌ ‌going‌ ‌to‌ ‌go‌ ‌above‌ ‌90%‌ ‌loan‌ ‌to‌ ‌value,‌ ‌there‌ ‌is‌ ‌a‌ ‌hit‌  ‌in‌the‌ ‌interest‌ ‌rate.‌ ‌Meaning‌ ‌your‌ ‌interest‌ ‌rate‌ ‌will‌ ‌be‌ ‌lower‌ ‌if‌ ‌you‌ ‌stay‌ ‌at‌ ‌90%‌ ‌loan‌ ‌to‌ ‌value‌ ‌or‌ below.‌ ‌A‌ ‌cash-out ‌refinance‌ ‌will‌ ‌pay‌ ‌off‌ ‌your‌ ‌current‌ ‌mortgage‌ ‌and‌ ‌then‌ ‌add‌ ‌to‌ ‌your‌ ‌loan‌ ‌amount‌ and‌ ‌use‌ ‌that‌ ‌extra‌ ‌amount‌ ‌to‌ ‌give‌ ‌you‌ ‌cash‌ ‌or‌ ‌pay‌ ‌off‌ ‌other‌ ‌bills.‌ ‌If‌ ‌your‌ ‌home‌ ‌has‌ ‌equity,‌ ‌you‌can‌ ‌put‌ ‌that‌ ‌equity‌ ‌to‌ ‌work‌ ‌for‌ ‌you‌ ‌and‌ ‌start‌ ‌saving‌ ‌money‌ ‌each‌ ‌and‌ ‌every‌ ‌month.‌ ‌You‌ ‌will‌ ‌want‌ to‌ ‌choose‌ ‌the‌ ‌right‌ ‌loan‌ ‌officer‌ ‌who‌ ‌has‌ ‌the‌ ‌knowledge‌ ‌to‌ ‌put‌ ‌you‌ ‌in‌ ‌the‌ ‌best‌ ‌financial‌ ‌situation‌possible!‌  ‌Our‌ ‌team‌ ‌is‌ ‌educated‌ ‌in‌ ‌helping you use your‌ ‌equity‌ ‌to‌ ‌use‌ ‌for‌ ‌your‌ ‌situation! ‌
VA‌ ‌interest‌ ‌rate‌ ‌reduction‌ ‌refinancing‌ ‌loan.‌ ‌This‌ ‌is‌ ‌commonly‌ ‌referred‌ ‌to‌ ‌as‌ ‌an‌ ‌IRRRL‌transaction.‌ ‌This‌ ‌is‌ ‌a‌ ‌great‌ ‌opportunity‌ ‌to‌ ‌lower‌ ‌your‌ ‌overall‌ ‌monthly‌ ‌obligation‌ ‌and‌ ‌save‌thousands‌ ‌of‌ ‌dollars‌ ‌over‌ ‌the‌ ‌life‌ ‌of‌ ‌the‌ ‌loan‌ ‌on‌ ‌interest‌ ‌payments.‌ ‌There‌ ‌are‌ ‌very‌ ‌specific‌requirements‌ ‌set‌ ‌forth‌ ‌by‌ ‌the‌ ‌VA‌ ‌but‌ ‌at‌ ‌its‌ ‌most‌ ‌basic‌ ‌qualifications,‌ ‌a‌ ‌lender‌ ‌must‌ ‌lower‌ ‌the‌veteran’s‌ ‌rate‌ ‌by‌ ‌at‌ ‌least‌ ‌half‌ ‌a‌ ‌percent.‌ ‌These savings ‌cannot‌ ‌come‌ ‌at‌ ‌a‌ ‌long-term ‌cost‌ ‌to‌ ‌the‌veteran.‌ ‌All‌ ‌closing‌ ‌costs‌ ‌must‌ ‌be‌ ‌recouped‌ ‌within‌ ‌36‌ ‌months,‌ ‌or‌ ‌the‌ ‌transaction‌ ‌is‌ ‌not‌ ‌allowed‌ per‌ ‌VA‌ ‌guidelines.‌ ‌
This‌ ‌is‌ ‌a‌ ‌failsafe‌ ‌to‌ ‌make‌ ‌sure‌ ‌lenders‌ ‌are‌ ‌not‌ ‌practicing‌ ‌churning‌ ‌or‌ ‌veterans‌ are‌ ‌not‌ ‌equity‌ ‌stripping‌ ‌their‌ ‌property.‌ ‌VA‌ ‌interest‌ ‌rate‌ ‌reduction‌ ‌refinancing‌ ‌loans‌ ‌are‌ ‌the‌ ‌most‌common‌ ‌VA‌ ‌refinance.‌ ‌This‌ ‌is‌ ‌a‌ ‌great‌ ‌time‌ ‌to‌ ‌take‌ ‌advantage‌ ‌of‌ ‌this‌ ‌program‌ ‌as‌ ‌many‌ ‌experts‌
predict‌ ‌interest‌ ‌rates‌ ‌will‌ ‌start‌ ‌to‌ ‌rise‌ ‌especially‌ ‌as‌ ‌inflation‌ ‌continues‌ ‌to‌ ‌rise.‌ ‌While‌ ‌nobody‌ ‌can‌predict‌ ‌the‌ ‌future,‌ ‌if‌ ‌you‌ ‌have‌ ‌not‌ ‌already‌ ‌completed‌ ‌an‌ ‌interest‌ ‌rate‌ ‌reduction‌ ‌refinancing‌ ‌loan,‌we‌ ‌encourage‌ ‌you to‌ ‌reach‌ ‌out‌ ‌to‌ ‌our‌ ‌team‌ ‌as‌ ‌fast‌ ‌as‌ ‌possible. ‌

2‌10-Day Rule

210-day ‌rule‌ ‌-‌ ‌VA‌ ‌mortgage‌ ‌lending‌ ‌has‌ ‌very‌ ‌strict‌ ‌seasoning‌ ‌requirements‌ ‌before‌ ‌you‌ ‌are‌allowed‌ ‌to‌ ‌refinance‌ ‌a‌ ‌current‌ ‌VA‌ ‌loan.‌ ‌All‌ ‌VA‌ ‌refinance‌ ‌transactions‌ ‌require‌ ‌the‌ ‌veteran‌ ‌to‌ ‌be‌ ‌in‌their‌ ‌current‌ ‌VA‌ ‌home‌ ‌loan‌ ‌a‌ ‌minimum‌ ‌of‌ ‌210‌ ‌days‌ ‌AFTER‌ ‌the‌ ‌veteran‌ ‌makes‌ ‌their‌ ‌first‌payment‌ ‌on‌ ‌the‌ ‌mortgage.‌ ‌Meaning‌ ‌if‌ ‌a‌ ‌veteran‌ ‌just‌ ‌bought‌ ‌a‌ ‌house,‌ ‌they‌ ‌are‌ ‌not‌ ‌eligible‌ ‌for‌ ‌a‌refinance‌ ‌transaction‌ ‌until‌ ‌210‌ ‌days‌ ‌have ‌elapsed‌ ‌from‌ ‌the‌ ‌date,‌ ‌they‌ ‌made‌ ‌their‌ ‌first‌ ‌payment.‌This‌ ‌is‌ ‌incredibly‌ ‌important.‌ ‌With‌ ‌historic‌ ‌low‌ ‌rates,‌ ‌many‌ ‌veterans‌ ‌are‌ ‌trying‌ ‌to‌ ‌refinance‌ ‌before‌this‌ ‌210-day ‌seasoning‌ ‌requirement‌ ‌is‌ ‌met.‌ ‌

Waiting Period Guidelines To Refinance 

Most‌ ‌veterans‌ ‌assume‌ ‌they‌ ‌need‌ ‌to‌ ‌wait‌ ‌210‌ ‌days‌from‌ ‌the‌ ‌date‌ ‌they‌ ‌close‌ ‌the‌ ‌transaction.‌ ‌We‌ ‌need‌ ‌to‌ ‌be‌ ‌very‌ ‌clear,‌ ‌so‌ ‌veterans‌ ‌understand‌ ‌the‌ ‌210-day ‌clock‌ ‌starts‌ ‌on‌ ‌the‌ ‌day‌ ‌you‌ ‌make‌ ‌your‌ ‌first‌ ‌payment‌ ‌on‌ ‌your‌ ‌VA‌ ‌current‌ ‌mortgage‌ ‌loan.‌How‌ ‌to‌ ‌start‌ ‌the‌ ‌VA‌ ‌refinancing‌ ‌process?‌ ‌After‌ ‌reading‌ ‌this,‌ ‌if‌ ‌you‌ ‌think‌ ‌you‌ ‌and‌ ‌your‌ ‌family‌ ‌can‌ benefit‌ ‌from‌ ‌refinancing‌ ‌with‌ ‌a‌ ‌VA‌ ‌mortgage‌ ‌loan,‌ ‌below‌ ‌are‌ ‌the‌ ‌steps‌ ‌to‌ ‌take.‌ ‌First‌, ‌you‌ ‌will‌contact‌ ‌Mike‌ ‌Gracz‌ ‌and‌ ‌630-659-7644‌ ‌or‌ ‌send‌ ‌an‌ ‌email‌ ‌to‌ ‌[email protected]‌ ‌Mike‌ ‌will‌then‌ ‌go‌ ‌over‌ ‌your‌ ‌financial‌ ‌situation‌ ‌in‌ ‌detail.‌ ‌

Starting The Mortgage Process

Mortgage process

It‌ ‌is‌ ‌important‌ ‌to‌ ‌understand‌ ‌that‌ ‌all veteran’s‌qualifications‌ ‌are‌ ‌different.‌ ‌After‌ ‌your‌ ‌one‌ ‌on‌ ‌one‌ ‌consultation,‌ ‌Mike‌ ‌will‌ ‌pair‌ ‌you‌ ‌with‌ ‌a‌licensed‌ ‌loan‌ ‌officer‌ ‌in‌ ‌which‌ ‌the‌ ‌property‌ ‌is‌ ‌located.‌ ‌After‌ ‌you‌ ‌fill‌ ‌out‌ ‌the‌ ‌application‌ ‌link‌ ‌that‌will‌ ‌be‌ ‌sent‌ ‌to‌ ‌you,‌ ‌your‌ ‌loan‌ ‌officer‌ ‌will‌ ‌start‌ ‌the‌ ‌origination‌ ‌process.‌ ‌They‌ ‌will‌ ‌pull‌ ‌your‌ ‌credit‌ and‌ ‌review‌ ‌your‌ ‌income‌ ‌and‌ ‌asset‌ ‌documentation.‌ ‌Depending‌ ‌on‌ ‌the‌ ‌loan‌ ‌program‌ ‌you‌ ‌choose,‌you‌ ‌may‌ ‌or‌ ‌may‌ ‌not‌ ‌need‌ ‌an‌ ‌appraisal.‌ ‌While‌ ‌waiting‌ ‌for‌ ‌the‌ ‌appraisal‌ ‌or‌ ‌other‌ ‌verifications,‌your‌ ‌file‌ ‌will‌ ‌be‌ ‌moved‌ ‌to‌ ‌a‌ ‌processing‌ ‌team.‌ ‌Your‌ ‌processing‌ ‌team‌ ‌will‌ ‌then‌ ‌get‌ ‌your‌ ‌file‌ ‌ready‌for‌ ‌the‌ ‌underwriting‌ ‌team.‌ ‌The‌ ‌underwriting‌ ‌team‌ ‌will‌ ‌let‌ ‌us‌ ‌know‌ ‌if‌ ‌any‌ ‌other‌ ‌items‌ ‌are‌ ‌needed‌to‌ ‌close‌ ‌the‌ ‌refinance‌ ‌transaction.‌ ‌
A‌ ‌refinance‌ ‌transaction‌ ‌will‌ ‌be‌ ‌a‌ ‌simple‌ ‌process‌ ‌if‌ ‌you‌ ‌select‌the‌ ‌right‌ ‌mortgage‌ ‌team.‌ ‌We‌ ‌are‌ ‌experts‌ ‌and‌ ‌look‌ ‌forward‌ ‌to‌ ‌saving‌ ‌you‌ ‌and‌ ‌your‌ ‌family‌ ‌money‌by‌ ‌refinancing‌ ‌your‌ ‌current‌ ‌mortgage‌ ‌loan.‌While‌ ‌we‌ ‌continue‌ ‌to‌ ‌explore‌ ‌the‌ ‌ins‌ ‌and‌ ‌outs‌ ‌of‌ ‌VA‌ ‌refinance‌ ‌transactions,‌ ‌we‌ ‌are‌ ‌sure‌ ‌you‌ ‌have‌questions.‌ ‌Please‌ ‌reach‌ ‌out‌ ‌to‌ ‌Mike‌ ‌Gracz‌ ‌on‌ ‌630-659-7644‌ ‌or‌ ‌send‌ ‌an‌ ‌email‌ ‌to‌[email protected]‌ ‌Gustan‌ ‌Cho‌ ‌Associates‌ ‌have‌ ‌come‌ ‌across‌ ‌many‌ ‌scenarios‌ surrounding‌ ‌VA‌ ‌mortgage‌ ‌lending.‌ ‌There‌ ‌are‌ ‌very‌ ‌few‌ ‌situations‌ ‌we‌ ‌have‌ ‌not‌ ‌encountered.‌ ‌We‌are‌ ‌available‌ ‌seven‌ ‌days‌ ‌a‌ ‌week‌ ‌and‌ ‌would‌ ‌love‌ ‌to‌ ‌help‌ ‌you‌ ‌and‌ ‌your‌ ‌family‌ ‌better‌ ‌understand‌your‌ ‌VA‌ ‌refinance‌ ‌options.‌ ‌Many‌ ‌of‌ ‌our‌ ‌clients‌ ‌have‌ ‌run‌ ‌into‌ ‌issues‌ ‌with‌ ‌their‌ ‌current‌ ‌lender‌ ‌and‌we‌ ‌are‌ ‌able‌ ‌to‌ ‌help.‌ ‌While‌ ‌rates‌ ‌are‌ ‌still‌ ‌low,‌ ‌we‌ ‌encourage‌ ‌you‌ ‌to‌ ‌reach‌ ‌out‌ ‌to‌ ‌us‌ ‌today.‌ ‌For‌ ‌any‌mortgage-related ‌questions‌ ‌please‌ ‌call‌ ‌Mike‌ ‌Gracz‌ ‌on‌ ‌630-659-7644.‌

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