VA offers special mortgage, refi deals

Here’s a Veterans Day update on a program I’ve written about before. If you’re an honorably discharged veteran looking for a new mortgage or a refinancing, be sure to check with the VA for their special deals for vets. You can use VA mortgage programs more than once in your lifetime. So if you closed on your VA loan in 2009 or earlier, your interest rate is likely at least 5 percent. Today’s VA rates are 4.25 percent, so it’s worth a refi.

For a $250,000 loan, dropping your rate from 5 percent to 4.25 percent will save you more than $100 a month. And over the long run, you’ll save a fortune in interest charges. That three-quarter point rate cut would save you $40,000 in interest over 30 years.

VA loans have been a good investment for the government. Statistics show that VA loans have the second-lowest default rate of any mortgage loan, second only to USDA farm loans.

For qualified veterans who want to refinance a previous VA mortgage, the VA automatically approves those who have made all VA mortgage payments on time and have a credit score of 620 to 640. Many lenders offer a free automatic appraisal, requiring a value of 95 to 105 percent of your mortgage balance. There are VA lenders who allow you to refinance even if you are slightly upside down on your mortgage.

The VA charges a 0.5 percent funding fee, which can be rolled into the new loan amount. For more information on the VA’s “Interest Rate Reduction Loan,” go to http://www.vainfo.net/irrls.html  or contact VA mortgage expert.

If you know someone who served in the military, please pass on this reminder. America’s veterans deserve this special benefit.