VA Loan Refinancing

Claim A Lower Interest Rate With VA Loan Refinancing

Capital Bank is a national lender with expertise in veteran mortgage ­– so you feel like you are speaking to your local expert.

As most Veterans know, VA home loans are a great benefit that can help you move into a home of your own. But what if you already have a home that you financed at a high interest rate? What if you need some of the cash from your home’s equity to send your kids to college, pay medical bills, or make some renovations? If you are a current service member or a Veteran, there is a VA loan refinance program for you. Capital Bank, N.A. wants to help you claim your benefits.

The VA has two VA loan refinance programs that might help you, depending on your needs.

Cash Out VA Refinance Loan

The cash out VA refinance loan will lower your interest rate and give you cash. This type of loan is handled by private lenders, with little involvement from the VA. However, as with original purchase mortgages, the VA backs the loan.

With a low interest rate, a cash out VA loan refinance has several advantages:

  • The program is good for homeowners with either a standing VA loan or with a non-VA loan.
  • Your interest rate will be lower than your current rate, which will make your payments lower.
  • You can refinance for up to 100% of the home’s value.
  • If you have equity in the home, you can take cash out at a cheaper rate than getting a home equity loan.
  • You can use the program to refinance a first and second mortgage.
  • You can use it for any principal residence, regardless of how long you have owned it.
  • The limit of the loan is $424,100.
  • You may have to pay closing costs and a VA funding fee, but both of these can be added to the balance of your loan.

Not all lenders allow you to take cash out. You may have to shop around with different lenders to find the one that will give you the best deal for your circumstances. Additionally, this type of loan requires an appraisal as well as a new Certificate of Eligibility.

Streamline VA Refinance Loan

If you have a VA loan that you want to refinance to take advantage of lower rates and resulting lower payments, a streamline VA refinance loan is for you. Also called an interest rate reduction refinance loan (IRRRL), this loan product is a no-fuss way to refinance quickly with few out-of-pocket costs and with less documentation required.

This loan has several provisions:

  • This program is only good for current VA loan holders.
  • You cannot use it to pay off second mortgages.
  • The loan value is up to $424,100.
  • The VA funding fee is only .5% unless you are exempt.
  • Credit requirements are not as strict and will permit one late mortgage payment over the last 12 months.
  • You do not have to currently occupy the property.
  • There is no maximum loan-to-value (LTV), but you may be able to refinance up to 100% of the home’s current market value.
  • No appraisal is required.

Many lenders do not even require a credit check, but this as well as the appraisal requirements may vary by lender.

How Can You Qualify For A VA Loan Refinance?

Applying for a VA loan refinance with cash back is virtually the same as applying for a new home loan. You must provide a Certificate of Eligibility and meet the service requirements. In other words, you must:

  • Be a current service member with at least 90 days of service
  • Have served as a minimum of 90 days in wartime or 181 days in peacetime
  • Be a current member of the reserves or National Guard with six years of service
  • Be a commissioned officer of the Public Health and National Oceanic and Atmospheric Administration
  • Be a surviving spouse of deceased combat Veteran who has not remarried
  • Been discharged for hardship, at the government’s request, or due to reduction in force, certain medical conditions, or handicap.

Applying for a Certificate of Eligibility is easier than ever. As long as you have your DD-214 proof of service, you can apply online. If you don’t want to take the six weeks or so that it takes to get this certificate by mail, you can work with Capital Bank, N.A. to obtain your COE in minutes. As long as your records are current and complete in the VA database, your lender can expedite receipt of the form.

If you are applying for an IRRRL, you do not have to produce a new certificate. Only individuals with existing VA loans are able to apply for the streamlined process, so your COE is already on file.

Even if you have a home already, you can still take advantage of VA loan refinance programs. For the cash out options, just contact our loan professionals at (866) 216-3577 or fill out our online application for pre-qualification. For an IRRRL, call us today to see how quickly we can get this loan process started for you.