Veterans in St. Johns County around St. Augustine, etc have some great VA refinance options available today. Depending on your current needs and equity position, The VA IRRRL Streamline refinance or Cash Out refinance could make sense. It’s no secret VA interest rates are still near all time low levels. Now be a great time to take advantage of the many VA refinance options available to St. Johns County residents. Below we will highlight some of the great benefits available today.
VA IRRRL Refinance Mortgage “Streamline Refinance”
A VA IRRRL loan is also referred to as “Streamline” refinance. The IRRRL ( Interest Rate Reduction Refinance Loan) guidelines are very simple and straight-forward with little paperwork – hence the name “streamline” No cash can be taken out by the homeowner with this type of VA refinance. Closing costs and energy efficiency improvement costs can be included into the new loan in most cases. VA IRRRL guidelines do not require the lender, bank or VA approved broker to perform a new appraisal check as long as the loan that is being refinanced was originally a VA guaranteed loan. The is great because borrowers can be upside down or “underwater” on their home loan, it doesn’t matter. Even though things have improved in recent years, many VA homeowners in Jacksonville, St. Augustine, etc are still upside down on their home loans. Borrowers that just want to lower their interest rate, change loan term or convert their current VA ARM loan to a VA Fixed rate loan can qualify for the streamline refinance mortgage. Contact at ph 904-810-2293 to discuss current VA mortgage interest rates.
IRRRL streamline loans are not assumable. No cash back is allowed even if you do have equity, just standard closing costs can be included in the new refinance loan. Second loans or home equity loans (HELOC) existing on the property must be subordinated to the new VA first mortgage. Home loans rates are still near very low in 2016 and should stay that way into 2017. Veterans can lock-in their rates by opting for a streamline loan offered by a VA refinancing lender. This IRRRL $0 cost option is the primary driver of its popularity among veteran home owners looking for “rate and term” refinance. One should carefully understand the specific refinance option’s guidelines and requirements to choose the appropriate option that fits their financing needs.
VA Streamline Refinance Requirements
VA basically provides the backing for the lender providing financing to the veteran and issues its lending guidelines and requirements. A veteran seeking a VA guaranteed home loan must qualify based on the financing lenders underwriting requirements related to income, credit, and assets. A lender can choose to enforce their own criteria (overlays) while evaluating a prospective borrower’s financial profile. VA loan eligibility depends primarily on the debt-to-income ratio. The residual income left for the household after paying for all the housing related expenses, monthly debt payments and taxes is used by mortgage companies to determine the eligibility of prospective seekers of a VA insured home loan. The residual evaluation followed in VA underwriting is much preferred to the plain vanilla debt-to-income ratio used in conventional residential lending guidelines.
Mortgage companies that finance residential properties based on conventional mortgage guidelines usually require a borrower to pay for Private Mortgage Insurance (PMI) when the loan to value is over 80%. However, VA allows 100% financing with NO requirement of PMI on the loans they guarantee. Instead, an upfront funding fee is assessed on all VA purchase and refinance loan transactions. Veterans receiving disability compensation related to the service are exempt from paying the VA funding fee. Zero monthly mortgage insurance remains a great benefit of VA loans that can save home owners hundreds each month.
Veterans Administration does not handle the loan process or provide the actual funding involved in VA home financing. All factors related to the loan pre-qualification and approvals are exclusively handled by the approved Florida VA mortgage company like Coast2Coast Lending to processing the loan. Lenders also pre-qualify, complete loan application, gather supporting financial documents, order the appraisal (when needed) and title, schedule a closing date and fund the loan. These steps performed during the VA loan approval are comparable to those followed in other government loan programs like FHA and USDA
The interest rates and discount points charged by lenders for financing VA home loans vary greatly according to applicant’s credit score and overall financial situation. Borrowers will have both fixed rate and adjustable rate financing terms available. VA lending guidelines clearly emphasize the occupancy requirement. Only properties to be occupied as a primary residence by the veteran after purchase can be financed through a VA loan program. The primary residence requirement can be waived for borrowers seeking faster financing through the streamlined VA IRRRL loan.
VA loan benefits can also be reused multiple times, VA home loan benefits offered do not end after one use. Any unused portion of the loan benefit gets carried forward. All state, county, and local housing programs or grants have blanket approval from VA. Due to this, they can be utilized in combination with VA home loan programs without special permission or review. Grants and programs that are offered to buyers by other non-public entities must be approved by VA before the closing.
The guaranty provided by VA only applies to the lender underwriting and funding the home loan for an eligible veteran. A thorough house inspection is the best way for the buyer to make sure that no significant issues have been overlooked. An appraisal cannot be considered as a substitute for a home inspection as the former a qualified opinion regarding the value of the property based on a rough overview of the property condition, local market, and recent sales, while the latter primarily assesses the physical condition of the home by noting any issues that need repair.
VA Cash-out Refinance Requirements
For St. Johns County VA home owners that DO have adequate equity, a VA cash out refi may be the perfect way to consolidate other high-interest debt. VA cash-out refinance loan allows a qualifying veteran to payoff high-interest debt credit cards, college loans and any other debt. One may also use refinancing to make further home improvements to increase their residential home value. Many VA lenders process these loans quickly and efficiently according to the refinancing guidelines set by Veterans Administration. The VA cash out refinance program will require a new appraisal to verify the property current value. VA cash-out refinance guidelines require that the veteran still occupy the property as their primary residence. When sufficient home equity is available, the owner can take out up to 100% of the homes value ( see below for more info on the 100% LTV cash out) All VA cash out loans can also include closing costs and other fees. As long as the LTV requirement is met, the seasoning of the loan may not be needed.
VA 100 Percent Loan To Value Cash Out
One of the best reasons for using a VA mortgage to refinance an existing loan is the 100% loan to value feature. The VA will still permit veterans to refinance and cash out up to 100% of the home’s appraised value in order to complete the loan. This is a great benefit since most other loan programs limit the borrower to less than the total value of the home. While the VA does charge a funding fee for each of their loans (for nonexempt borrowers) the funding fee is added on top of the loan amount in order to allow the veteran to refinance without paying anything from their pocket. The 100% VA cash out refi can make very good sense for those residents in Jax, St. Augustine that do have some equity in their home, and want to consolidate high-interest debt. VA interest rates are low, it may make sense to cash out to pay off super high interest credit cards, car loans, or installment loans you may have. It’s important to note, many banks and lenders cap the loan to value on VA cash out to 80-90% loan to value. Coast2Coast still permits up to 100% loan to value cash out refinance to qualified home owners.
Happy to serve Florida, including St. Johns county: Contact us by calling 904-810-2293 or just submit the Quick Request form on the left side.