Hawaii VA Loans

If you’ve ever purchased a home before, you’ve probably been asked if you wanted to “points” or not pay “points”. Now, if you are like most people, the common answer would be, “I’m not sure - what would you suggest?”. Well, before we get into the specifics of when it is beneficial to pay points or not, let’s go over what the exact purpose of points when it comes to closing costs.

A point is an upfront fee that is paid at closing to reduce your interest rate. A “point” is always 1% of the loan amount. For instance, using a $300,000 loan amount, one point would cost $3,000 at closing. Now keep in mind - you don’t have to pay points if you don’t want to (except when dealing with adjustable-rate mortgage loans - where sometimes it’s mandatory to pay a point to guarantee the lender a yield) but by doing so, you’ll decrease not only your monthly payments but also the total amount of interest paid over the life of the loan.

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Many people know the benefits that VA Loans have when purchasing a property. No down payment required, no Private Mortgage Insurance, reduced closing costs, among others. But many VA mortgage holders don’t realize that they have another huge benefit. When interest rates drop - VA mortgage holders can easily reduce their rates through a streamline process - also known as the Interest Rate Reduction Refinancing Loan (IRRRL) Program.

The IRRRL Program, or VA Streamline Refinance, allows a current VA mortgage holder to reduce their interest rate without extra requirements needed by conventional mortgage holders.

• No Appraisal Required
• No Income Verification
• No Asset Verification
• No Out-of-Pocket Expense

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