VA Cash Out Refinance

Background

Both Brenda and Christopher work in the healthcare industry and had struggled to purchase their home—needing Brenda’s mother to co-sign in order for them to qualify. As a Navy veteran, Vantage was able to utilize the VA loan for their initial home purchase.  Once they had a new baby, they felt like they had outgrown their house and reached back out to Vantage to help them find a new home as they had made over $100K in equity since the initial purchase. After shopping around for a house, they were unable to find a home that fit their needs and their budget. Vantage helped them to see that a refinance would not only allow them to take out cash to remodel the house and increase the value, but that their current home was in a great location, their other child was enrolled in the school locally, and they would be able to remove their mother as a co-signer from their loan. This would allow them to build the house to fit their needs and the family would stay in the neighborhood that they love.

Client Requirements

With both clients in the healthcare industry, the qualifications are a bit more strict. The bank calculates the average over the last two years and if the income is increasing year over year, they take the two year average (sum of the two years income divided by 24 months) and use that to qualify their income. If their income decreases in the second year, the banks will only use the lowest year income to qualify the loan.

Loan Challenges 

There were challenges in getting them to max out their purchase power and for that reason Vantage decided to refinance rather than make them over stretch their means.

Solution

A cash out refinance.

The Results

Vantage was able to allow Brenda and Christopher access up to 90% of their home value to not only do the home improvements—adding another bedroom, remodeling the kitchen, updating the backyard and bathroom—but they were also able to pay off some back taxes and debts. The plus side is that they got to make their home perfect for their needs and stay in the neighborhood they had come to love.