VA Loan Refinance Options
If you have already used your VA loan, you may still benefit from working with a lender to get better terms. Called “refinancing,” this process is similar to the home buying process but does not include the home search or contract negotiations.
You already own the home but are just seeking better financing. This may be the result of the market rates lowering, your personal financial situation improving, or the value of your home going up.
There are two main ways to refinance your VA loan.
Cash-Out Refinance Loan
A cash-out refinance loan allows borrowers to take advantage of lower interest rates, and also receive cash for equity in their home. Borrowers can borrow up to 80% of the current value of their home minus the current mortgage. Borrowers can use the cash to make home improvements, pay for college tuition, consolidate debt, purchase investment properties, or for any other purpose. You can apply with us to see if you meet the requirements for a cash-out refinance loan.
The Interest Rate Reduction Refinance Loan (IRRRL)
The Interest Rate Reduction Refinance Loan (IRRRL) allows applicants to take advantage of a new VA loan with a lower interest rate. Two big advantages are that an applicant does not need to have their home appraised to qualify, and there is no income or employment verification required. To be eligible for an IRRRL, you must currently have a VA loan that has been open for at least 210 days, and you must also be current on your mortgage payments.
For homeowners whose first mortgage had a variable interest rate, an IRRRL may be able to provide better stability by locking in a lower, fixed interest rate. An IRRRL has specific requirements, such as never having been delinquent (30 days past due) on your mortgage on any payment in the last 12 months.