St. Louis Real Estate Blog

Cash-Out Refinancing for Veterans

November 21st, 2008 9:29 AM by Melanie Mitchell - Team Lead/Listing Specialist

New Rule Allows 100% Refinance

Choosing the right loan product these days is a difficult and time-consuming task. Change is happening rapidly in the mortgage business, whether it is the daily fluctuation of interest rates or the introduction of new governmental policies.  

Recently, the President signed into law the Veteran's Benefits Improvement Act of 2008. Among the benefits to veterans is an immediate ability to do a "cash-out" refinance up to 100 percent of the appraised value of their home. The refinance threshold was 90 percent before the bill was signed on October 10, 2008.

This is good news for veterans and brings the refinance option up to par with the maximum guaranty amount for home purchase loans of 100 percent. Currently, the military represents a huge market of potential home buyers with approximately 152,000 troops in Iraq alone. As security improves and these troops start coming home, many may want to take advantage of Veterans Administration (VA) home loan benefits.

The VA offers guaranteed loans to purchase a new or existing home, rate reduction refinance and cash-out refinance. Borrowers are evaluated by their credit worthiness and their ability to show stable and sufficient income, to cover the costs of owning a home, cover other obligations and expenses, and maintain funds for family support. Traditional credit scoring is not used by the VA for underwriting.

Recap of the VA Program for Home Purchases:

Jeff Griege
Paramont Mortgage Company
Posted in:General
Posted by Melanie Mitchell - Team Lead/Listing Specialist on November 21st, 2008 9:29 AM

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