EXISTING LOAN: Total if all payments were made to amortization term listed above on the existing loan

PROPOSED LOAN: Total if all payments were made to amortization term listed above on the proposed loan

EXISTING LOAN: Total of all payments on remaining term of existing loan

PROPOSED LOANS: Total if all payments were made to amortization term listed above on the proposed loan

EXISTING LOAN: Total of all payments on remaining term of existing loan

PROPOSED LOANS: Total if all payments were made to amortization term listed above on the proposed loan

Important Information for Veteran in Regards to Removing Equity From Home: By removing equity from your home, you may end up paying more interest, taking longer to pay the home off and if the market declines in value you may owe more than the home is worth. Additionally, you will have to pay interest on the equity you withdraw from your home.

To the best of my knowledge, I, 3, from 1, have determined that the proposed refinance loan outlined in Section I meets the following net tangible benefits (check all that apply):

Directions: Lender Representative to mark an "X" in front of applicable test, ensure "Pass"

I/We hereby certify that I/we understand the estimated effect the proposed refinancing has on my loan balance, payments, interest rate, term, total payback of payments, and remaining equity in my home should I/we accept a refinance loan.

IMPORTANT: Please read the information below carefully to help you understand the information presented on this form. Some sections of the form also contain notes or specific instructions for completing that section.

What is the purpose of this certification?:
This form/document is intended to provide the Borrower(s) with a comparison of key loan characteristics on both an existing loan and a (proposed) cash-out refinance loan. The information provides the Borrower(s) with information about the overall cost of the cash-out refinance loan and assists in making an informed decision about whether to proceed with the refinance loan.

Who completes this certification?
This form/document is intended to provide the Borrower(s) with a comparison of key loan characteristics on both an existing loan and a (proposed) cash-out refinance loan. The information provides the Borrower(s) with information about the overall cost of the cash-out refinance loan and assists in making an informed decision about whether to proceed with the refinance loan.

Do I need to keep a copy of this certification?
Lenders must maintain copies of all loan origination records of VA guaranteed home loans for at least 2 years from the date of loan closing. The Borrower(s) should also keep a copy of the certification as part of his/her loan records

The Lender should complete the Refinance Loan Comparison for both the initial disclosure at application and the disclosure at closing. Important: For the initial disclosure (e.g., Section I), when possible, the Lender may use estimated information about the existing loan and proposed loans. If such information is not available or is incomplete (i.e., current appraised value of the home), the Lender must estimate this information and explain this to the Borrower.

VA Loan Identification Number (LIN)
should be provided for the existing loan and the proposed/new loan. If the existing loan is not a VA guaranteed or insured loan, the Lender should indicate the type of existing loan (i.e., FHA, conventional, etc.).

The (Estimated) Impact of Refinance
must be shown as an increase or (decrease) from the existing loan to the proposed/new loan.

Loan Balance
reflects the remaining unpaid principal balance for the existing loan, including any second liens or HELOCS, and the principal balance for the proposed/new refinance loan. For the proposed/new refinance loan, this amount should include any VA funding fee and other (estimated) closing costs if such costs are financed as part of the loan.

Monthly Payment
reflects the total monthly amount of principal, interest, and mortgage insurance (if any) owed by the borrower on the existing loan and proposed/new refinance loan.

The Lender should indicate the appropriate Loan Type for the existing loan and proposed/new refinance loan (i.e., Fixed; Adjustable Rate Mortgage (ARM); Hybrid ARM; Home Equity Line of Credit (HELOC)). The Borrower should consult with the Lender if more information is needed about the listed loan type.

Total of the Remaining Scheduled Payments reflects the (estimated) total the Borrower will have paid after making all remaining payments of principal, interest, and mortgage or guaranty insurance (if applicable) for the existing loan and proposed/new refinance loan.

The Loan-to-Value Percentage is calculated by dividing the Loan Balance by the appraised value of the property, expressed as a percentage. Important: For the initial disclosure (e.g., Section I), the Lender must estimate the current appraised value of the property if a current appraisal is not available. The final disclosure (e.g., Section IV) must use the VA appraisal (also known as the Notice of Value (NOV)) to calculate the Loan-to-Value Percentage.

Home Equity reflects the difference between the home’s reasonable (appraised) value and the outstanding balance of all liens on the property.

Section II and VI – Net Tangible Benefit
To be eligible for VA guaranty, a cash-out refinance loan must demonstrate that it meets at least one of eight net tangible benefits. In completing this form, the Lender must select all net tangible benefits that apply to the proposed/new refinance loan. The Borrower should consult with the Lender if additional information is needed about each net tangible benefit selected and how the Lender determined it was met.

Section V – Refinance Closing Summary
The Lender should complete this section only for the disclosure provided at closing. The purpose of this section is to provide the Borrower(s) with a summary of the proposed refinance loan BENEFIT (e.g., the amount of cash directly disbursed to the Borrower(s) and/or the amount of payoff disbursed on behalf of the Borrower(s) at closing) and COST (e.g., the amount of increase in total paid over life of the refinance loan for this one-time cash disbursement). Payoffs should include all payoffs for debt on behalf of the Borrower(s), excluding mortgages, at time of closing. If the Borrower has any concerns or questions about this information, he/she should discuss these with the Lender prior to closing.