VA CASH OUT REFINANCE Guide Cont.
What is the VA Cash Out Refinance program?
The VA Cash Out Refinance Program allows Veterans and Active Duty Military Servicemembers to tap into 100% of the value of their home to pay off debts, finance home improvements, payoff your home early, or anything else you can think of. Low VA rates and flexible VA mortgage terms allow you to use the cash out for whatever you’d like, including paying off the home quickly.
How does the VA Cash Out Program Work?
VA Cash Out refinances begin with something called an e-file, which is basically a digital VA loan package that tells you definitively what you qualify for on a VA cash out refinance—down to the penny. It makes the VA cash out refinance process fast, easy, and convenient, because you can literally sign the VA cash out documents right from your own computer—with the click of a mouse.
The best VA lenders will get an appraisal ordered for you quickly after gathering some supporting documents. After your VA cash out appraisal report is completed, you’ll know exactly how much cash out you can take on your VA mortgage refinance.
For example, if your VA mortgage has a balance of $200,000 and your VA appraisal report produces a value of $300,000, this means you can cash out $100,000 using the VA cash out refinance program.
VA Cash Out benefits program:
The most popular use of VA Cash Out program is to pay off debts like credit cards, unsecured loans, car loans, a second mortgage, etc. Using the hypothetical VA cash out scenario above with $100,000 in equity, let’s assume you also hypothetically have $75,000 worth of debts you’d like to payoff:
Car Loan: $25,000 – Payment $480/month
Lending Club Loan: $15,000 – Payment $820/month
USAA Credit Card: $10,000 – Payment $250/month
Wells Fargo Credit Card: $12,000 – Payment $280/month
Chase Credit Card: $8000 – Payment $240/month
Bank of America Credit Card: $7000 – Payment $210/month
Total Debts: $75,000 – Total Payments: $2,280/month
With the VA cash out refinance program, you can payoff all of these debts and save literally $2,280/month, which puts you in a position in which you literally live debt free for everything except the VA mortgage.
Using the example above, if you plan to use the VA cash out proceeds for home improvement, then you are basically using your equity to build more equity while living a more comfortable lifestyle. For example, if you decide to fix your roof and renovate your kitchen, basement, or backyard (or anything else) for $100,000, then you will increase the value of your VA home mortgage by 75% or $75,000 of what you paid in home improvements.
In a nutshell, you can use $100,000 in equity to add an additional $75,000 in equity to your home while living a more comfortable lifestyle for you and your family, and effortlessly increase your home’s value from $300,000 to $375,000.
The VA Cash Out refinance Loan gives qualified veterans the chance to refinance their conventional or VA loan into a lower rate while extricating cash from the home's equity.
With the VA Cash Out refinance, you have the chance to hand the equity over your home into cash. This shouldn't be mistaken for a home equity loan, which is a second loan that keeps operating under your first VA loan. The VA Cash Out refinance loan replaces your current mortgage as opposed to supplementing it.
Qualified homeowners can refinance up to 100% of their home's value for mortgage debt now and in the future. In other cases, homeowners can refinance up to a lower rate and utilize the cash to cover debt installments and different needs.
In the case of refinancing a conventional, FHA or USDA loan, the VA Cash Out refinance option is available regardless of the loan type. Numerous homeowners pick the VA Cash Out refinance alternative over different kinds of VA loans in light of the possibility to repay the VA mortgage loan over a more extended timeframe, and ordinarily, the VA Cash Out refinance choice is accompanied by low VA rates.
VA Mortgage Loan - 5 Quick Facts
Due to state regulations, Texas veterans are not qualified for VA cash out refinance loans.
For those refinancing from a conventional or other mortgage program, you are not required to take any cash out.
VA Cash Out Refinance loans follow the standard VA Loan underwriting and credit process.
The closing costs and VA funding fee can be rolled into the whole loan sum.
You should guarantee that you expect to involve the property being refinanced.
VA Cash Out: VA Home Improvement Loans
A VA Cash Out refinance gives access to cash from the equity you've generated in your home — and you're allowed to utilize the cash for whatever you need:
Conceivable outcomes include:
Significant Home Repairs
Redesign Your Kitchen
Redesign the Bathroom
Educational cost and Books
Pay Off Debt
And that's just the beginning...
To begin on your VA Cash Out refinance, contact the money saving experts at 855-VA-LOAN-0 (855-825-6260) or fill out the VA loan quote questionnaire!