- At least 6 monthly payments must have been made on the original loan being refinanced; AND
- The first payment due date of the new loan must be at least 210 days after the first payment due date of the original loan being refinanced
- A copy of the Note from the previous loan being refinanced must be provided
- An IRRRL refinancing a Fixed Rate Mortgage into another Fixed Rate Mortgage must result in a rate IRRL is also know as Interest Rate Reduction Loan in VA terms.
- reduction of at least 0.5%
- An IRRRL refinancing a Fixed Rate Mortgage into an Adjustable Rate Mortgage must result in a rate
- reduction of at least 2.0%
- IRRRLs in which a Discount is being charged to the borrower will now require an Exterior-Only Appraisal to be ordered
- If the Discount being charged is 1% or less, the loan will be limited to 100% LTV based on the value of the Exterior-Only Appraisal
- If the Discount being charged is more than 1%, the loan will be limited to 90% LTV based on the value of the Exterior-Only Appraisal
- Loan must current be guaranteed by VA and must be current
- Closing costs must be recouped within 36 months
- Proposed P&I payment must be less than current payment unless:
- Veteran refinancing ARM to Fixed
- Term of IRRRL is shorter than existing loan as long as payment does not increase over 20%
- Energy efficiency improvements are included in the IRRRL
VA Guaranteed by the Veterans Administration for qualified military veterans. No down payment if the property appraises for the sale price or greater. Credit underwriting is flexible. No Minimum credit score for VA loans, but lenders will create overlays to protect their selling ability to VA for delinquent mortgage loans sold to VA. A lot of VA lenders want a 620 credit score, with some going down to 580, and a few will do down below that but very difficult to get approved with a VA lender. No monthly mortgage insurance payments are required, however they're upfront funding fees that range anywhere from 2.1% to 3.3% based on previous use or first time use of VA eligibility to buy a home, or if you are disabled, you may have not to pay this at all.
The VA Certificate of Eligibility will show if you have to pay a funding fee to VA or if you are exempt.
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