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Gainesville VA Refinance Options

This page updated and accurate as of 10/01/23

 

VA refinancing can be a great option to help Gainesville home owners reduce their monthly mortgage debt and save money. In addition to the streamline refi options, VA has a wonderful cash out refinance that allows up to 100% loan to value. The Department of Veterans Affairs provides options to do both, a VA Streamline Refinancing loan to reduce the rate and term of your current loan. In addition, the VA Cash-Out Refinancing loan that permits home owners to “cash out” equity. Below will take a closer look at the Gainesville VA refinance options and qualifying criteria that is involved for home owners that have a VA mortgage benefits.

Alachua County VA home owners that have questions anytime can us at ph: 888-705-1975. Five Stars is Florida’s leading VA loan resource local serving all of Florida including Alachua County:  Archer, Gainesville, Hawthorne, High Springs, La Crosse, Micanopy, Newberry and Waldo FL.

Gainesville VA Streamline Refinance Requirements:

In order to get approved for a VA streamline refinance, you must meet the following requirements:

  • Timely mortgage payments with no more than (1)  30 day late pay within the past year.
  • The new VA monthly mortgage payment must be lower compared with the original VA mortgage payments prior to the refinance (often the case when switching from an adjustable rate mortgage (ARM)  to a fixed rate mortgage).
  • Cash Out not permitted on the IRRRL or Streamline program (only the cash out program below)
  • The property in which you choose to refinance must be the one that you previously uses your VA entitlement for.

The VA streamline refinance is also known as the VA IRRRL program (which stands for Interest Rate Reduction Refinance Loan) and they are the same program.

VA Streamline IRRRL General facts and Guidelines:

  • The VA streamline has less documentation than a regular refinance which means you can close quickly.
  • Most lenders can do VA streamline without a new appraisal, saving the home owner money. However, the VA cash out program will always require a new appraisal.
  • Most loan applicants can roll all closing costs and fees into the new loan so there are no out-of-pocket costs when doing a VA streamline.
  • One rule for the VA streamline is that the new monthly payment must be lower than the previous loan’s monthly payment. One exception to this rule is when you are refinancing an adjustable rate (ARM) mortgage or the new loan term is less than the old one.
  • Your new loan interest rate must have a lower interest rate than the previous loan. An exception is if you are refinancing from an adjustable rate loan – like 7/1 ARM into a 30 year fix.
  • With the VA streamline program, your new loan can be a fixed rate or adjustable rate term.
  • Your monthly loan payment may increase if you finance energy efficient home improvements, finance your closing costs including the funding fees, finance points, or get a higher interest rate if you move to a fixed rate loan.

100 percent VA Cash Out Refinance: 

  • Eligible Veterans that do have equity in their homes can “cash out” of to 100% of their homes value.
  • New appraisal always required.
  • Full income and asset documentation required.
  • Use the money for just about anything – consolation of higher interest debt, home improvements, pay for your school tuition, etc.

VA Home Loan Underwriting Requirements:

VA mortgage loan underwriting requirements are focused on the borrower’s credit and income, but also include provisions designed to ensure the borrower will use their loan for purposes approved by the VA. The VA has certain underwriting requirements, and lenders typically supplement these with their own requirements as well. An example of VA underwriting requirements is that applicants must live in the property within a certain period of time after closing, and use the property for approved purposes. Additionally, most lenders, banks or brokers may require a minimum credit score to qualify for a loan (normally a 620 score)  Anyone that uses their VA loan (purchase or refinance) will be required to pay the applicable VA funding fee. See the latest 2015 VA funding fee and loan amount limits here.

As for what property can purchase with a VA mortgage loan, borrowers can use their VA entitlement to purchase existing or new single-family houses, but that’s not all. Other approved uses of a VA mortgage loan include:

  • Purchase of an approved town home or condo.
  • Finance of custom new home construction – by builder.
  • Home improvements, repairs or upgrades, including “green” upgrades.
  • Refinance of an existing loan to lower interest rates or monthly payments.

Loan approval essentially requires the borrower to be a good credit risk and able to repay  the loan. The property must meet the VA home standards, otherwise known as VA minimum property requirements.  Homeowners in Alachua County / Gainesville can contact us at ph: 888-705-1975 or just submit the quick REQUEST INFO form on the top left side.