The Federal Savings Bank Federal Savings Bank is veteran - owned bank, with a focus on VA and FHA lending for active duty and retired military and first time home buyers. We believe we offer the Perfect Mortgage Experience, which is our unique combination of outstanding customer service, low mortgage rates, and fast closings. We call it the Perfect Mortgage Experience because for 20 years that’s how our customers have come to know and refer us.
300 N. Elizabeth Street #3E


Refinancing VA loans may help reduce mortgage payments

Refinancing VA loans may help reduce mortgage payments
Click Image to view larger

Veterans who have a VA loan may benefit from an Interest Rate Reduction Refinance Loan. The loan may allow the interest rate to be reduced when an existing VA home loan is refinanced. Once an IRRRL is administered, the monthly mortgage payment should decrease, according to the Department of Veterans Affairs.

Individuals who have an adjustable rate mortgage may refinance into a fixed mortgage rate. However, the refinancing loan can only be made on a property that used a VA loan to purchase the home. When applying for an IRRRL, no appraisal or credit underwriting package is required, and no money out-of-pocket is needed.

Certificate of Eligibility is not required when applying for an IRRRL​, and the applicant only needs to certify previous occupation of the home for which the applicant is seeking an IRRRL for. While not all interest rates or payments may decrease, many will still find refinancing beneficial.

Many homeowners across the country are seeing positive results from refinancing, according to the second annual refinancing analysis by Freddie Mac. The mortgage company reported 84 percent of homeowners who refinanced their first-lien home mortgage during the fourth quarter in 2012 maintained the same loan amount or lowered their principal balance by paying-in additional closing costs.

"On average, borrowers who refinanced reduced their interest rate by about 1.8 percentage points​," said Frank Nothaft, vice president and chief economist at Freddie Mac. "On a $200,000 loan, that translates into saving about $3,600 in interest during the next 12 months. Fixed-rate mortgage rates hit new lows during December, with 30-year product averaging 3.4 percent and 15-year averaging 2.7 percent that month, according to our Primary Mortgage Market Survey.”

The average interest rate reduction reported was about 1.8 percentage points, saving homeowners about 33 percent on their interest rates, resulting in the largest percent reduction recorded in the 27 years of refinancing analysis.

Tagged As : Refinance Loans , Veteran Initiatives

Related News

Mortgage rates fall for third consecutive week

Mortgage rates fall for third consecutive week

Following continued market turbulence, mortgage averages continued to fall for the third consecutive week.

January 21, 2016

Housing market stays quiet before Thanksgiving holiday

Housing market stays quiet before Thanksgiving holiday

The week before Thanksgiving was economically very quiet with mortgage rates mostly holding steady.

December 1, 2015

Mortgage rates trend downward following global market instability

Mortgage rates trend downward following global market instability

Global market concerns led to a small drop in average mortgage rates for the week ending on Jan., 7.

January 7, 2016

Why The Federal Savings Bank

Our goal is to develop customer relationships that are measured in terms of decades … not weeks or months, or even years.

Learn More
Find More ATM Locations