VA Refi
Refinancing your VA Loan
If you are an active military personnel or veteran, you have many benefits when it comes to supporting you and your family. One of the best benefits is the option to obtain a VA loan. Even if you already have a house that you are paying a mortgage on, you can still refinance it with a VA loan which is much more affordable than traditional loans. Quite often veterans buy houses before they qualify for the VA loan, and if this is you, you can still refinance now with a better rate. This is the best time to refinance, while interest rates are low, so take a look at a few options that are available to you if you qualify now.
If you have a traditional loan, you will need to go through the entire loan process again to obtain a new VA refinanced loan. You will have to qualify with the VA, provide credit checks, appraisals, etc. for every person on the loan. You will basically be getting an entirely new loan. Even if you have a low rate with a traditional loan, it will still be more affordable to go through the VA.
The VA doesn’t actually lend the money, but they do guaranty the loan up to half the amount. This means you have cheaper monthly rates because you won’t have to pay premium mortgage insurance. You can also get a larger loan than you would normally qualify for while maintaining a low interest rate. You also have different repayment options to choose from: traditional fixed, graduated payment mortgage (GPM), growing equity mortgage (GEM), traditional ARM and hybrid ARM.
Traditional Fixed vs. Graduated Equity
The traditional fixed payment plan has a set interest rate that remains stable over the life of the loan. This is a great option for people who want the same annual payments for the entire loan. The graduated payment mortgage starts out low and gradually increases over time, but levels off after the sixth year and remains stable after that. The benefit of using this type of repayment is the mortgage is inexpensive right off the bat, but goes up as you are able to afford it (due to a promotion, raise, etc).
The graduated equity mortgage also increases over time, but the increases are only applied to the principal of the loan, which helps you pay off the loan quicker over time. There is also the option of getting a traditional ARM that is adjusted annually but never more than one percent each year, or five percent over the life of the loan. A hybrid ARM locks you into a fixed rate for three years, but can change as much as two percent after the third year.
How to Get Started
To begin a VA refi, simply fill out our free 1-minute quote request form and start comparing rates immediately. It’s never been easier to refinance so get started now!
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