Refinancing a mortgage loan to get a lower rate has become a sport. Many people think that there is no reason not to refinance and then refinance again. All this activity based is on the concept that the transaction cost to lower the interest rate was zero, zip, nada. Where borrowers are correct is that it is easy to refinance a loan and not have to bring any money to the table. Where they are wrong is that the process is free.
If you are a military veteran or are on active duty, a VA loan may be the perfect loan for you. The Veterans Administration provides guaranteed loans, made by VA-approved lenders to eligible military members. The VA guaranty protects the lender not the borrower from loss resulting from the loan not being repaid. The VA loan programs offer many advantages to veterans and can be obtained with little or no down payment with a competitive mortgage rate. Borrowers can choose a fixed or variable rate loan. The loan can be used to purchase a home or refinance an existing loan. The process is different from conventional loans.
To refinance your existing mortgage seems to be an inalienable right. Do not listen to the “experts” that will tell you once the prevailing mortgage rate falls .50 – 1% below the rate on your current mortgage you should refinance. Running off to refinance your mortgage when headlines announce mortgage rates are falling is not the best of ideas.
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