Streamline Your Worries Away: Get A Lower Interest Rate With A Streamline VA Refinance

If your head's been buried in the sand, you may have missed the recent borage of mortgage refinance advertising. However, all eligible veterans should first consider the VA streamline refinance when looking for a suitable loan product. In fact, we'd like to share some key information on the differences between traditional refinancing and the VA streamline refinance.

First and foremost, conventional underwriting guidelines does not take into consideration the needs of veteran borrowers. Many restrictions make it difficult for the veteran homeowner to obtain financing, including lower LTVs, higher interest rates, considerable out-of-pocket costs, credit qualification and prepayment penalties. In short, conventional borrowers are bombarded with significant amounts of paperwork and left playing the waiting game in many instances.

On the flip side, the VA streamline refinance, a.k.a. Interest Rate Reduction Loan (IRRL), is a more veteran friendly. The first thing to keep in mind is that VA loans are specifically designed to meet the needs of veterans. Typically, there are less documentation and eligibility requirements, including no appraisals (upside down equity is okay!), no asset verification or credit review. Veterans with credit scores below 640 also have a chance to apply and receive financing approval! But the good news doesn't end with the previous benefits. Veteran's can expect to pay no out-of-pocket costs and may even be able to defer two loan payments or roll closing costs into the refinance transaction. Now these are cost savings conventional mortgages simply cannot beat. Pound for pound, the VA loan is consistently a superior choice.

And if you thought these mortgages were only good for the service members and their families, think again. You may be surprised to discover that lenders have an incentive to enter into these transactions. Since the passage of the Service men's Readjustment Act of 1944, the VA has guaranteed a portion of VA mortgages; thus reducing the lender's risk. Therefore, a bank has an incentive (limited risk) to give you the best rate possible. This is why VA interest rates are so much lower than conventional mortgage rates.

These comparisons make it obvious why veteran mortgages are so attractive. If your goal is to lower your mortgage interest rate and save on out-of-pocket costs, all with little or no hassle, a VA streamline refinance is waiting for you. To obtain more information about the benefits of VA loans, contact an approved financial institution in your area or visit the Veteran's Administration Department website.

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