Refinancing your loan using a "streamline" loan program is far simpler than obtaining your original loan. The process can be completed quickly and usually does not require a credit check or even a home appraisal. There are a few conditions that the Veteran's Administration requires homeowners to meet:
First, all of the borrowers on the original loan must remain on the new streamline loan. This condition is what allows the VA to offer a streamline loan without a credit check- all parties on the loan will have gone through the original process to obtain a loan which includes credit and employment verification, so the VA is already sure that those borrowers are able to pay back the loan.
This also means that if you are trying to remove another party from your loan, such as after a divorce, you will need to complete a new loan rather than refinance your current mortgage. The good news is that if you plan to add another party to your paperwork, such as a new spouse, you can do so with a VA loan. The new borrower will still need to meet credit requirements and an approved debt-to-income ratio however.
It should also be noted that a streamline loan cannot be used to get cash from the home's equity; it is strictly a program designed to lower the interest rate of your home.
If you can meet these simple requirements and you already have a VA-backed home loan, you may be a good candidate for a streamline refinance.
The program is available to both active duty and veteran members of the armed forces, so don't be afraid to find out more if you have retired since receiving your loan. The first thing you will want to do is contact a mortgage company or bank that can help you through the VA streamline process.
Be sure your loan officer is specifically experienced with VA loans, as they often have special requirements that those who haven't worked with this type of loan before may struggle with. Your loan officer will tell you about the costs associated with your VA streamline loan, any documentation you will need to provide, and will let you know how quickly they can complete the loan.
One of the benefits of refinancing with the VA streamline program is that you will likely be able to skip a loan payment, which can be a great way to pay off bills or just put a little extra money aside.
