Sorting real refinance offers from aggressive mail aimed at VA homeowners
Skipped-payment pitches
Safeguard
You do not truly skip payments. Interest is paid in arrears, so the timing of a refinance can leave a month without a due payment, but that interest is added to the new loan payoff or collected at closing. A refinance sold mainly on skipped payments may cost more than it saves.
Last reviewed against the primary sources listed below.
Where the money goes
Accrued interest on the old loan appears in its payoff, which the new loan pays.
Mailer questions
Is skipping a payment when refinancing free?
No. The interest is still paid, usually through the new loan.