Can You Refinance a NACA Loan?

NACA, or the Neighborhood Assistance Corporation of America, is a non-profit organization that helps low-to-moderate income homebuyers purchase homes by providing them with affordable mortgage loans. The NACA program’s goal is to make homeownership accessible to everyone.

Can You Refinance a NACA Loan?

One question that often comes up for NACA borrowers is whether they can refinance their NACA loan in the future. The answer is yes, you can refinance a NACA loan. In this article, we’ll explore the refinancing process for NACA loans in detail.

Understanding NACA Loans

Firstly, it’s essential to understand what makes a NACA loan unique compared to other types of mortgages. A few key features of a NACA mortgage include:

  • No down payment required
  • No closing costs
  • Below-market interest rates
  • Fixed-rate loans
  • No PMI (private mortgage insurance)
  • Credit score not considered

NACA loans are only available through the organization and are designed specifically to help lower-income earners purchase homes without falling prey to predatory lenders who may offer high-interest mortgages or adjustable rate mortgages (ARMs).

Why Refinance a NACA Loan?

There are various reasons why someone might want to refinance their NACA mortgage. Some common reasons include:

Lowering Interest Rates

One significant advantage of refinancing a mortgage is the possibility of lowering your interest rate. If interest rates have dropped since you first purchased your home, refinancing could allow you to obtain a new loan with lower monthly payments.

Shortening the Repayment Term

Another reason people choose to refinance their mortgages is to shorten their repayment terms. By refinancing into a 15 or 10-year fixed-rate loan instead of your initial 30-year term, you could save thousands in interest payments over time.

Accessing Home Equity

Refinancing can also provide homeowners with access to their home’s equity, which can be used for various purposes such as home repairs, debt consolidation, or a child’s college education.

Refinancing a NACA Loan

If you’re considering refinancing your NACA loan, there are several steps you should follow:

Check Your Credit Score

Before applying for any type of loan, it’s crucial to check your credit score. Although NACA doesn’t require a minimum credit score to qualify for its loans, refinancing with other lenders may require you to have a good credit score. Aim for a score of at least 700 before applying for refinancing.

Shop Around

The next step is to shop around for the best rates from various lenders. Make sure to compare interest rates, fees (such as application fees or appraisal fees), and repayment terms. It’s also helpful to obtain pre-approval from multiple lenders to see what options are available.

Gather Required Documents

Once you’ve selected a lender and completed the pre-approval process, you’ll need to gather all required documents necessary for refinancing. These include:

  • Pay stubs
  • Tax returns
  • Bank statements
  • Proof of insurance
  • Your current mortgage statement
  • An appraisal report (required by some lenders)

Apply for Refinancing

After gathering all necessary documentation, complete the refinancing application either online or in-person with the lender of your choice.

Close on Your New Loan

Once approved, close on your new mortgage loan with the help of an attorney or title company. Be prepared to pay closing costs again when refinancing your NACA mortgage with another lender.


In summary, it is possible to refinance a NACA loan; however, borrowers must follow specific steps outlined above. By understanding the reasons why people choose to refinance their mortgages and taking the necessary steps during the refinancing process, homeowners can potentially save thousands of dollars in interest payments over time.


Can I refinance my NACA loan if I am facing financial difficulties?

Yes, you can refinance your NACA loan if you are facing financial difficulties. However, you need to discuss the matter with your loan officer and provide them with all the relevant information regarding your current financial situation. They will then guide you on how to proceed with refinancing your NACA loan

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