VA Loan Cashout Refi for Orange County Borrowers

Orange County homeowners with a VA loan are finding there are big advantages to the VA Cashout refinance program. This program actually does not require the loan being refinanced to be a VA loan, as long as the borrower is eligible for a VA loan.  The biggest advantage of this program over most other cashout refinance programs is that the borrower can borrow money up to 90% of the properties value, while a Conventional loan allows cashout up to 80% loan to value, and FHA allows cashout up to 85% loan to value.

What is the Difference between a VA IRRRL and a VA Cashout Refi for Orange County Borrowers?

Orange County borrowers need to keep in mind a few of the differences between the popular IRRRL, or VA Interest Rate Reduction Refinance Loan,  and a VA Cashout refinance.  The IRRRL program is strictly a “Rate and Term” refinance, and the current loan needs to be a VA loan. Also, income is not verified, and in most situations, there is no appraisal. (Although there have been some changes to the appraisal requirements and some lenders are tightening up this program.) The VA considers any refinance that is not an IRRRL to be a cashout refinance. This means that if an Orange County VA eligible borrower wishes to refinance from a Conventional (Fannie Mae or Freddie Mac) loan, then even if they will not pull cash out, VA still considers it a cashout refinance and it must be underwritten as such.

VA Loans Are Flexible with FICO Scoring

Another big advantage for a VA cashout refinance versus a Conventional cashout refinance is the relative flexibility towards FICO scoring. For VA eligible borrowers with FICO scores under 700, if may make more sense to go with a VA loan even you only plan to pull cash out to 80% loan to value. Fannie Mae and Freddie Mac have instituted pricing “addons” which increase the fees and rate for cashout refinances when the FICO scores drop below 740. If your score FICO drops below 700, the pricing hits really start to add up. With VA, the pricing hits for low FICO’s are minimal.

VA Guidelines Regarding a Cashout Refinance

The actual VA guidelines allow for cashout to 100% loan to value, but finding a lender who will allow this will be difficult. Lenders tend to stay with the 90% rule, although there is some flexibility if the borrower is not actually getting cashout and the loan to value is over 90%. This is something that should be reviewed by an experienced Orange County VA loan officer prior to paying for an appraisal.

Authored by Tim Storm, an Orange County, CA Loan Officer MLO 223456– Please contact my office at Emery Financial Group for more information about an Orange County, CA home loan.  877-786-4243 x 7.

www.OCFHALoans.com

Contact us for your Orange County VA Mortgage:

Call our office today and see how we can help you and your family. Ask for your Free First Time Home Buyer Report.

877.786.4243 x 7 | tstorm (at) ochomebuyerloans.com

 

Comments

  1. Just wanting to find out if I could get a VA loan with a fico score of 680?

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  1. […] when the loan to value is 90% or better, which is automatic on a cashout refinance.) **For those Orange County VA loan eligible homeowners , it gets even better. VA will allow a cashout refinance up to 90%, and with no monthly mortgage […]

  2. […] VA Cashout refinance guidelines are even better for Orange County homeowners. VA guidelines will allow up to 100% loan to value, although most lenders cap it at 90%  of the property’s value. For those Orange County homeowners eligible for a VA loan, now is the time to check it out. […]

  3. […] VA mortgage interest rates for Orange County borrowers also remain low. […]

  4. […] 1st and 2nd or Equity Line of Credit) should act quickly to avoid the MIP increase.  **Of course, Orange County borrowers considering a cashout refinance who are eligible for a VA loan should definitely check out the benefits of a VA loan. With the high limits that VA now offers, and […]

  5. […] when the loan to value is 90% or better, which is automatic on a cashout refinance.) **For those Orange County VA loan eligible homeowners , it gets even better. VA will allow a cashout refinance up to 90%, and with no monthly mortgage […]

  6. […] those VA eligible homeowners in Orange County, the VA Cashout refinance program has several advantages over a Conventional (Fannie Mae or Freddie Mac) cash out refinance. […]

  7. […] VA allows “cash out” refinancing up to 90% of the property value. This is much better than Conventional financing, which would have severe pricing “hits” for doing a “cash out” refinance at even 80% of the properties value on a loan amount under $417,000. Most Conventional loan guidelines consider combining a 1st and 2nd to be a “cash out” refinance. With the drop in property values since 2007, many homeowners have not been able to combine their 1st and 2nd mortgages because of the tight Conventional loan guidelines. But Orange County Veterans have the ability to combine their 1st and 2nd up to 90% of the properties value. […]

  8. […] does not need to be a VA loan. Many current Orange County homeowners are finding that being able to refinance out of a Conventional loan and into a VA loan at 100% loan to value is a great thing. And remember, no mortgage insurance, which FHA and […]

  9. […] VA Cashout refinance guidelines are even better for Orange County homeowners. VA guidelines will allow up to 100% loan to value although most lenders cap it at 90% of the propertys value. For those Orange County homeowners eligible for a VA loan now is the time to check it out. […]

  10. […] process. However, it is only for current VA loan borrowers. For those Veterans who wish to refinance into a VA loan from a Conventional or FHA loan, they would need an appraisal and full income documentation. But the good news is they […]

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