How to Get Started on a VA Refinance?
The internet can be a wonderful source of information, but it is also an overwhelming place. I did a quick search for ‘VA Loan Articles’ and there were almost six MILLION hits. I tried narrowing it down a bit and searched ‘VA loan refinance’… still over 2 million options. Third times a charm, right? ‘VA loan streamline refinance’ gives us 135,000 results. While that narrows things down a bit, it’s still more than anyone wants to look at.
So how do you know what your options are? How do you get started on a VA refinance? What do you need to be prepared?
I am not a licensed loan officer so I will leave the discussion on rates and program options to them, but I have been a loan officer assistant for over a year and have fielded a lot of questions about what is needed to get the loan process started.
First of all, let’s talk about the idea of a streamline loan. A streamline is going to be faster and less complex than a conventional loan. Typically we do not need paystubs, tax returns, or appraisals. You don’t have to deal with contracts and lots of third party companies. Even though the list of things we need is significantly shorter, it’s important to remember that your loan officer and his or her team will only ask you for documents and information that is necessary. The faster you are able to get us the documents we need, the faster your loan will go through the system. A streamline refinance is still a refinance. There are a lot of details that have to be taken care of, but we do try to make it as quick and painless as possible.
What exactly do you need to send your loan officer?
- Borrower’s Authorization
- Application or Information Sheets
- Proof of Social Security number and Date of Birth
- Current Mortgage Statement
- Home Owner’s Insurance
- State specific documents
- HOA statement
- Awards/Retirement letters
- Utility Bill
- Non-participating Spouse full legal name
Many people look at that list and think, “Wait! I thought this was supposed to be a streamline?! You shouldn’t need all of this.” I know it seems like a lot, but remember how much shorter that list is than the one you had to go through with a purchase. Believe me; we want to keep it as simple as possible for you.
So…Why Do You Need to Send All Those Documents?
Let’s start with the documents on the ‘Always’ list:
Application and a Borrower’s Authorization-
These two documents are sent to you by the loan officer and are absolutely essential. Your application, or information sheets, gives us the basic details we need to set up your file. Please take the time to fill out all the questions/requested information. The borrower’s authorization is a protection for you and our company. By signing it, you are giving us permission to start your file. We keep your authorization in the file at all times to prove that you did start this process and when you started it.
Proof of Social Security Number and Date of Birth-
Usually, this is satisfied with copies of your Social Security Card and photo ID. To avoid fraud and to stay in compliance with the patriot act, we need to be sure that you are who you say you are.
*Important side note* All the information on the cards has to be legible, color copies or clear photos are the way to go on this. Faxes come in totally blacked out 9 times out of 10.
Current Mortgage Statement-
This gives us the current breakdown of your Principle and Interest payment, as well as information on your escrow account. It also verifies the loan number and the servicer information we need to order the payoff.
Home Owner’s Insurance-
We do not need the entire insurance binder, just the declaration page. This page has your annual premium amount as well as some basic coverage information. If you have a flood insurance policy we need the declaration page for that as well. Once your loan is in processing we will call and have them update the mortgagee clause to reflect your new lender, that way your insurance provider knows who to expect payments from.
This is usually a 3-4 page document that can be found with the closing documents from your home purchase or most recent refinance. The note is used to verify the original loan amount, original interest rate, VA case assignment number, and how the borrower names are listed on the loan.
Now for the documents on the ‘Sometimes’ List:
State Specific Documents-
Like the title suggests, this varies by state. Most states do not require additional documents, but some do. For instance, Texas loans are required to have a survey of the property in the file. Illinois files require income documents; W2s and 30 days paystubs. Your loan officer’s team will let you know if your state has specific documents that are required and what they are.
If you are a member of a Home Owner’s Association we will need a copy of your statement specifying your annual dues. We are not going to include HOA dues in your loan amount, but we have to have the information on file anyway.
If you are not currently employed some lenders will ask for awards letters or proof of retirement income. Because your loan is a streamline the lender will not be verifying income amounts or checking bank statements, but they do need to verify that there is some kind of income. This is used as evidence that the mortgage payments can be made. Your letter should have come to you at the beginning of the year.
If the address listed on your driver’s license does not match your current address we will request a utility bill. Any electricity, cable, gas, or water bill will work, as long as it is addressed to you and shows that the servicing and mailing addresses are the same. We have to make sure that your property is either Owner occupied or Non-owner occupied. It really doesn’t change the process, but it is important to have the correct information in the file.
Non-Participating Spouse Full Legal Name-
If you are married but your spouse is not on the loan documents, it is very likely that he or she will need to sign a few pages at the closing. This is a requirement in most states. If you send us your spouse’s name at the beginning of the process we can make sure the lender and the title company have all their documents prepared correctly from the start. This does not change who is on the loan.
Those are the basics! Once you are further into the process, you may be asked for additional information, but we won’t go into that here.
Remember, your loan officer wants to help you and make the refinance process as quick and easy as possible. It does require a bit of legwork on your part to get everything together, but once the initial documents listed here are in, you’re off to a great start and a great refinance experience.
Laura Dudley started with Low VA Rates as a loan officer assistant in 2014. She has since taken on the role of Pipeline Manager for several loan officers. As an assistant and pipeline manager, Laura keeps track of all the files her team is working on. She contacts borrowers with updates, helps them access documents/initial disclosures, gathers conditions, orders final loan documents, and schedules closings. Laura has degrees in Elementary Education and History. While a career in the loan industry was not something she had planned on, she loves her job and the opportunity it provides to serve Veterans and active duty Military service men and women.
“Every file is important and comes with its own unique set of challenges, that’s what keeps me motivated and learning new things every day. I want every borrower to feel cared for and to know that their loan means more to Low VA Rates than just a set of numbers.”