The VA loan began in 1944 through the GI Bill of Rights. A VA loan is a mortgage loan guaranteed by the U.S. Department of Veterans Affairs (VA). The VA Loan provides veterans with a federally guaranteed home loan which requires no down payment. The main purpose of the VA home loan program is to help veterans finance the purchase of homes with favorable loan terms and at a rate of interest which is usually lower than the rate available on other types of mortgage loans.
The VA created a program called the Streamline Refinance to provide a way for existing VA homeowners to refinance their current loans to lower their interest rate with no out-of-pocket costs. A VA Streamline Refinance loan is also called a IRRRL - Interest Rate Reduction Refinancing Loan. These loans can also be made faster and with less documentation than a typical loan. Benefits include:
- •No appraisal
- •No out-of-pocket closing costs
- •No income verification (unless payments increase 20% or more)