The Department of Veterans Affairs has issued a proposed rule that would prohibit lenders from charging more than two discount points in refinancing a VA loan.The proposed rule also requires that borrowers be current to refinance. The comment period ends Aug. 3. The proposal grew out of VA investigations in early 1997 that found some lenders were charging borrowers 4-6 discount points to refinance. The VA also wants to stop lenders from encouraging borrowers to skip two or three monthly payments before refinancing. These lenders promise to refinance VA loans and roll the overdue payments into the principal amount of the loan.
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