Refinancing with VA Home Loans

Refinancing with VA Home Loans

Refinancing with VA Home Loans

Refinancing with a VA Loan

Refinancing a VA loan falls into one of two categories: those seeking better loan terms & those seeking cash-out. What’s the difference? Put simply, it comes down to whether your goal is to obtain better terms on your mortgage (a lower interest rate and/or lower monthly payment, for example) or if your goal is to refinance your loan and raise some funding (thus cashing out, so to speak).

A cash-out refinance is a form of mortgage refinancing that results in a higher total mortgage balance, but with the benefit of that higher rate resulting in a portion of cash being released to the veteran or service-member doing the refinancing. The additional funds can be used towards, really, any project you desire. Common purposes, though, include furnishing or remodeling your house, purchasing new appliances or repairing the property, or paying off existing debt.

A more traditional option, however, would be refinancing your existing mortgage with the goal of lower interest rates or payments. This is often referred to as an IRRRL (Interest Rate Reduction Refinance Loan). Generally, these types of refinancing options don’t require a new appraisal, and often closing costs can be included in the loan’s completion.

The takeaway here should be that refinancing with a VA loan can result in cash-out for multiple purposes or reduction in your monthly payments and mortgage interest rate. If you qualify, why not pursue it?

 

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2 Comments
  • David Johnson
    Posted at 22:43h, 21 January Reply

    Before reading this, I didn’t realize that you can refinance an existing mortgage to get lower payments. One of my friends is struggling with payments this year. He’ll have to look into refinancing.

  • Sam Li
    Posted at 19:48h, 27 February Reply

    I love what you said about receiving additional funds and how they can be put towards any project you want. When it comes to financing a home, contacting a loan service is crucial in order to get the monetary assistance you require. If I were to come across someone that could benefit from a VA loan, I would make sure to contact the best financing company their respective area.

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