With Veterans Day coming up this month, now is a prime time to consider taking advantage of our VA loan program. There are lots of options under the program that can be used in different ways. Those who qualify can enjoy many benefits of a VA loan to get them into the property they want, refinance to use the equity they’ve built, and save money along the way.
Here are your options:
If you’re buying your first house, up-sizing, or moving to a new neighborhood or state, you may be eligible to use a VA loan to fund your purchase. There are several benefits to choosing a VA loan over a traditional loan program. The required down payment is generally smaller, private mortgage insurance (PMI) isn’t required, and your credit score doesn’t need to be as high as it does to get approved for other loan programs. In fact, there are no set credit score requirements for qualifying for a VA loan.
If you’re eligible, you can use a VA loan to finance a primary residence house, a condo that’s in an approved project, and a manufactured home with or without the lot.
Buying a home with a VA loan is simple. Meet with your MIG loan originator and bring a copy of your Certificate of Eligibility (COE). He or she will complete your application, run your credit report, lay out the options available to you, and answer all of your questions.
Interest Rate Reduction Refinance Loan (IRRRL)
You may also hear an IRRRL be called a “streamlined refinance.” If you own a home but want to take advantage of lower interest rates, opting for an IRRRL may be your best move. Decreasing the length of your mortgage loan or moving from an adjustable rate to a fixed rate are other good reasons to consider an IRRRL.
The IRRRL offers three big benefits that many other types of refinance products don’t. First, you don’t need an appraisal to refinance, and second, you don’t need to verify your income. Finally, this loan may be closed with no money out-of-pocket, as all fees and costs can be rolled into the new loan.
Example: Regular military veterans, Reserves, and the National Guard can expect .5% whether it’s a first-time or subsequent use.
While a VA loan for a purchase requires the property to be your primary residence, with an IRRRL you only need to prove you occupied it at some point. Getting cash out of this type of refi isn’t permitted, although you can add up to $6000 into the loan to pay for energy-efficient improvements to the property.
If you need to tap into the equity of your home, you might want to check out a…
You can use the VA cash-out refinancing option for a variety of reasons. Have you gotten yourself into some credit card debt? Do you need to pay for your kids’ tuition? Are there medical bills hanging over your head? Whatever your reason, a VA cash-out refi allows you to access up to 100% of your property’s equity. This is a big advantage in that traditional refinance programs only allow access to 80% of your equity, and FHA refis only allow 85%. The extra amount you can access with a VA refi can cover expenses, reduce debt, or sponsor home improvements you need and wouldn’t be able to afford otherwise.
Example: Regular military pay 2.15% while Reserves and the National Guard pay 2.4% for first-time use. All types of military pay 3.3% for subsequent use.
The requirements for a cash-out refinance with the VA loan program are straightforward. You must confirm the property is your primary residence. In addition, the closing costs can’t be rolled into the loan, so you must be responsible for them to qualify for this option.
Related Read: Essential VA Loan Tips to Get Approved
With Veterans Day approaching, we want to thank the men and women who are serving or have served our country. We ask to assist you in securing your next mortgage loan, whether it be a purchase or refinance, by helping you understand all of your options. One of them could be the right one for you and your family. Contact us today to find out.