Wednesday, January 14, 2009

Five Easy Steps to a VA Loan

The VA streamline refinance home loan is a mortgage program backed by the government itself. This mortgage loan is basically meant for veterans who are yet active in their duties or were involved in prior services. This loan is popularly also referred as the interest rate reduction loan.

In order to lower the interest rate of your current VA home loan, this program comes in more than handy. Not only is it a fast way in which to refinance the current VA loan, it is also pretty simplistic and hassle free. In case you have bad credit, if you did not have more than a single 30-day late payment of mortgage in past one year, you can still fall into eligibility criteria for the refinance of this VA streamline loan.

So you see, credit is not a yardstick for the qualification for VA streamline refinance program. Similar is the case with job verification documents, appraisals, and income documents. They are not required either. The existing VA home loan can be refinanced and this requires no extra expenses on your part. All the close-costs etc. incurred are considered in the total amount of loan.

Certificate of Reasonable Value
It relies on the estimate of an appraiser. This pertains to the estimation about the value of the property that one wishes to purchase. The amount for the loan should not be more than the CRV.

The initial step for getting the VA loan is requesting for an appraisal. This request for a VA appraisal can be made by anyone, whether a seller, a buyer, or a personnel from the real estate industry or even a lender. The completion of the VA from 26-1805 thus makes a successful request. This form, upon completion, should be mailed to the office of the VA, more specifically, to the Loan Guarantee Division. Another option is to request for the appraisal by telephone. One can telephone the Loan Guarantee Division to assign an appraiser.

One must recognize the fact that while the estimation of the property's value is being done by the VA appraisal team, this does not cover the inspection of the property and hence does not assure that the house does not have any defects. The state of the property is not guaranteed by the VA, only the loan is.

The process for applying for VA financing is same as applying for other types of loans. As a matter of fact, the application form is same as the ones for HUD/FHA loans. The income and assets of the applicant is verified by the mortgage lender. A credit report is obtained to see that other commitments have been paid. If all goes well, then in most cases, the lender can close the loan under the automatic procedure of the VA.

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