What is a VA Streamline?
A VA streamline or IRRRL (Interest rate reduction refinancing loan), allows you to refinance your existing VA loan with out having to entirely re-qualify for the new loan.
1. No appraisal / Value consideration.
2. No income or employment disclosed on the application.
3. No assets or liabilities (accept the mortgage debt) disclosed on the application.
Cash out:
There is no cash out allowed on a VA streamline (accept for closing costs).
If you have a second mortgage:
If you have a second mortgage and want to take advantage of the streamline, you can do what is called a subordination. A subordination is a process by which the second mortgage holder agrees to remove the lien then replace it after the streamline is complete. This is at the discretion of the second mortgage holder and may involve fees and an application process.
Credit Requirements:
Varying from lender to lender there may or may not be credit or credit score requirements, however, the existing VA loan must be current and there cannot have been any late payments (past 30 days) on the mortgage in the past 12 months.
Benefits:
1. Lower rates and payments.
2. Skip 1 or 2 mortgage payments.
3. Get a refund of your existing escrow account.(in most cases).
Closing costs:
The costs vary from lender to lender but typical costs may include:
1. VA funding fee - (.5%) - Exempt if the veteran is receiving disability compensation.
2. Title charges - Costs vary by state and county.
3. Bank fees - Vary by lender i.e. points, origination, Processing, underwriting, etc..
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