Can You Refinance from a Conventional or FHA Loan into a VA Loan?

 

✅ Absolutely — and it can save you thousands.

If you’re a Veteran or Active-Duty homeowner currently holding a Conventional or FHA loan, you may be sitting on an untapped opportunity: the VA Cash-Out Refinance.

Even if you didn’t use your VA benefit when you first bought your home, it’s not too late to leverage it now — and the potential savings can be significant.

Here’s how it works:

The VA Cash-Out Refinance allows eligible Veterans, Active-Duty Service Members, and certain surviving spouses to refinance their existing mortgage — even if it’s not a VA loan — into a VA-backed loan.

This isn’t just for pulling cash out of your home equity (though that’s an option). Many borrowers use this program simply to move out of higher-cost FHA or Conventional loans and into the VA program’s lower-cost structure.

Key Benefits:

1. Eliminate Monthly Mortgage Insurance (PMI or MIP)
FHA loans come with upfront and ongoing mortgage insurance premiums. Conventional loans often require PMI if your equity is below 20%.
A VA loan has no monthly mortgage insurance, instantly reducing your monthly payment.

2. Access Up to 100% of Your Home’s Value
The VA program is one of the few that allows you to refinance up to 100% loan-to-value (LTV) — giving you the flexibility to consolidate debt, fund home improvements, or simply improve your loan terms.

3. Potentially Lower Your Interest Rate
Depending on market conditions, refinancing into a VA loan can secure a lower rate, particularly if your current loan is higher than what VA offers today. Lower rates mean lower payments — and long-term savings.

Example:

Let’s say you bought your home in 2021 with a $350,000 FHA loan at 6.75%. After three years, your home is worth $400,000 and you still owe about $330,000.

If you refinance into a VA Cash-Out Refinance:

  • You could eliminate MIP, saving roughly $150–$200/month.

  • You could refinance up to 100%, taking out cash if needed.

  • You might lower your rate — saving even more long-term.

That’s real money back in your pocket every month.

Eligibility Snapshot:

  • You must have VA loan entitlement (Veteran, Active Duty, or qualifying surviving spouse).

  • A new appraisal and credit check are required.

  • The home must be your primary residence at the time of closing.

Bottom Line:

If you’re a Veteran or Active-Duty homeowner with a Conventional or FHA mortgage, you may be paying more than you need to. The VA Cash-Out Refinance can help you:

  • Ditch mortgage insurance

  • Unlock your home’s full value

  • And possibly lower your interest rate

It’s one of the most powerful refinance options available — and it’s reserved for those who’ve served.

Ready to find out how much you could save?
Let’s explore whether a VA Cash-Out Refinance makes sense for your situation.

#VALoan #Veterans #Refinance #TX #FL #MortgageTips #HomeOwnership

About Between Two Doors

Between Two Doors is a podcast where I talk with Realtors about their journey, aiming to connect home buyers and sellers with agents on a more personal level. I ask "right brain" questions that go beyond transactions, focusing on the experiences, values, and passions that make these professionals great at what they do.

Listen to more episodes: https://www.betweentwodoors.com

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Premier Lending, Inc. – https://www.natecarver.com

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