Conditions

Conditions. The Board shall consider, on a case by case basis, refinancing of loans under the following conditions: A. If a veteran has a temporary loan originally made for the purpose of acquiring the house. (The Board has defined a temporary loan as a loan with an initial term of three years or less. Balloon notes with an initial balloon date of Seven (7) years or less may be considered a temporary loan provided that it can be determined that the intent of this loan is temporary due to construction, repairs, the lack of available permanent financing or other such verifiable reason.) B. If a veteran has a loan in place with a variable rate of interest, terms or payments, and the loan was made with temporary intent. If such loans have a pre-payment penalty, the Board will construe that the lender has an objection to an early payoff and that the loan was not made with temporary intent. C. If a veteran is experiencing a hardship due to no fault of his or her own, and is in jeopardy of losing his or her home, and the refinancing will help prevent the loss of the home. A case of this nature is to be reviewed by the Board on a case-by- case basis. If the loan securing the home has a prepayment clause, the Board will ascertain the benefit of an early payoff of the loan on a case-by-case basis. Any prepayment penalty and /or closing costs may be included in the new loan amount financed subject to VA rules and regulations regarding refinancing. D. If a veteran has obtained a construction loan in order to build a house. The Veteran’s Home Purchase Board may pay off any loans or liens pertaining to the land or construction of the house once the house is completed and as long as the loan is not a permanent loan. This is subject to VA rules and regulations. E. When it is determined by the Board of Directors of the VHPB that due to the state of the economy, the mortgage market or other reason or condition that may have an adverse effect on the trust fund or present mortgage customers, the Board may at its discretion allow for the refinance of portfolio loans provided the following: 1. Funds are available to the Board from the issuance of its notes or bonds in amounts in excess of the funds required for applicants on a waiting list for their first loan from the Board. 2. The veteran has an outstanding mortgage or mortgages (one must be with this agency) on the property to be refinanced. 3. The refinanced loan must comply with the Department of Veterans Affairs guaranteed loan program guidelines for refinance. 4. The refinance loan shall be limited to the payoff of the existing mortgages plus the closing costs of the transaction and further limited to eighty percent (80%) of the property value or amount of the Department of Veterans Affairs guaranty available on the refinance loan not to exceed the Agency’s limits. 5. The Board may establish interest rates, terms and conditions on refinance loans which may differ from original loans made by the board. 6. The loan or loans to be refinanced must have a payment record of no payments thirty (30) days late for the past 24 months. 7. A second mortgage held by another lender will be allowed to subordinate to our first mortgage on a case by case basis. In all of the above cases, the Board shall ascertain that the veteran has not obtained and continued any form of temporary financing for the purpose of waiting for financing by the Board when he could have previously obtained adequate permanent financing.