VA Streamline Refinance

2007-10-15 12:53:47

( Financial )



VA Loans Defined

VA loans were adapted in 1944, and were intended as a special benefit to veterans, providing them with federally guaranteed loans that do not need credit checking or down payments. The VA loan helped countless veterans realize their dream of owning a home at the lowest cost. As long as you were in active military duty with no record of dishonorable discharge, you qualify for the VA loan.

The VA Streamline Refinance Package

During the early 80s, the government launched the VA streamline refinance package, acclaimed to be one of the best refinancing programs ever. This package allowed borrowers of FHA or VA loans to actually lower their loan rates, with no credit checks or additional fees. It also exempted you from having to submit any additional documentation, and instead relied upon the original documents you have submitted previously when you first got the VA loan. The process of obtaining documentation and back-up information is thus streamlined in this type of VA loan.

If you have an existing VA loan, you can opt for VA refinancing as long as you never had any overdue payments on any of your liabilities. You may also lengthen the payment period, for example, from 15 years to 30 years.

Once you opt for a VA streamline refinance package, your new loan rate will be locked by the loan officer. Only fixed rates are used in VA streamline refinance packages.

Tips for the Borrower

The key to enjoying the privileges of a VA streamline refinance package is correct timing. You should refinance only when interest rates are at their lowest.

You can always check for interest rates through your local lender or on the web. Sites that process VA streamline refinance packages post the interest rates daily. You can observe the trends of the rates for a few days, or consult your loan officer about them.

Once you think that the loan rates have reached an ideal level, you can easily lock the rate immediately.

While the lender may not need additional documentation from you, it will still be helpful to be ready with vital information about yourself in case anything needs to be verified. Your prompt response will prevent any delay in the processing of your VA streamline refinance loan.


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