Converting from a conventional loan to a VA Loan

Eligible veterans who currently have a conventional loan can still look at refinancing into a VA loan. This is not the same as the VA streamline refinance mentioned elsewhere. If the circumstances are favorable, the borrower can use their VA eligibility to refinance.

If the borrower has an adjustable rate mortgage (ARM) or a high fixed interest rate, then converting can be worth looking into. The biggest hurdle in changing to a VA loan is there is the VA funding fee of 2.2%* on this type of refinance. However, if the borrower is exempt from the VA funding fee this can make the refinancing even more lucrative.

* Example: For a $150,000 loan; 360 monthly payments of $809.26 are based on principal and interest only, and an annual percentage rate (APR) of 5.068%. APR is subject to borrower qualification and subject to change. Third party fees may apply. According to the United States Department of Veterans Affairs..