VA Refinance Home Loan Programs
The Veterans Administration has 2 VA home loan refinance programs available for veterans. The VA streamline refinance and the VA cash-out refinance.
VA Cash-out Refinance
The cash-out refinance is a VA home loan refinance program for veterans who want to cash-out on the equity they have built up in their home. The cash-out proceeds can be used for any purpose. A VA home loan refinance under the cash-out program differs from the VA streamline refinance in that an appraisal is required and you must qualify for the loan. Also, unless you are exempt, VA charges a 3% funding fee for this program, however, the fee can be rolled into the loan amount.
VA Streamline Refinance
The streamline refinance also called the interest rate reduction loan is a VA home loan refinance program for veterans who currently already have a VA loan and simply want to refinance in order to lower their interest rate & monthly payment. Income and credit qualifying is not required nor is an appraisal needed. The only restrictions are the mortgage must be current and you cannot have had more than one 30-day late payment within the last 12 months. Also cash-out or consolidation of junior liens is not allowed. If you need cash-out or want to combine a 1st and 2nd mortgage then you will need to apply for a cash-out refinance.
VA Home Loan Refinance Program Comparison
|
VA Streamline Refinance |
VA Cash-out Refinance |
|
| Cash-out Allowed |
No |
Yes |
| Must Credit Qualify |
No |
Yes |
| Must Income Qualify |
No |
Yes |
| Appraisal Required |
No |
Yes |
| Can Combine 1st and 2nd Mortgage |
No |
Yes |
| Maximum Loan to Value (LTV) |
No Maximum |
90% |
| Maximum Loan Amount |
$417,000 |
$417,000 |
| VA Funding Fee |
.5% (unless exempt) |
3% (unless exempt) |
| Mortgage Lates Allowed In Last 12 Months |
1(30 day) |
0 |
| Property Must Be Owner Occupied |
No |
Yes |
