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VA IRRRL Guidelines

 

Who Is Eligible for a VA IRRRL?

  • Current and former U.S. military servicemembers with qualified credit
  • Homeowners who already have a VA-backed home loan and currently live or previously lived in the home covered by the loan
Note: Refinancing your mortgage may result in higher finance charges over the life of the loan.
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Refinance Your VA Home Loan with a VA IRRRL

VA Interest Rate Reduction Refinancing Loan (VA IRRRL), also known as a VA Streamline Refinance, is an easier, faster and less expensive refinancing option that allows qualified borrowers to take advantage of lower interest rates or shorten the mortgage repayment period.

There are several benefits to refinancing a mortgage with a VA IRRRL, including:

  • Getting a lower interest rate. When interest rates are low, refinancing can reduce your monthly payment and help you build equity in your home faster. The general rule is to consider refinancing if your interest rate would drop by at least 0.50% to 1%.
  • Switching to a different loan type. While an adjustable-rate mortgage (ARM) may offer a lower starting rate and more affordable monthly payments at least in the initial years of the loan, a fixed-rate mortgage allows homeowners to lock in their rate for a long period of time. Depending on your financial situation, it may make sense to switch your current mortgage to a different type of loan — especially switching from a variable to a fixed-rate mortgage to provide stable payments over the life of the loan.
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VA IRRRL Requirements

Homeowners interested in refinancing with a VA IRRRL must have a VA-backed home loan. Other requirements include a credit review and verification that the homeowner is a current or previous resident of the home covered by the current loan. If you have a second mortgage on your home, the holder of that loan must agree to continue being the second mortgage so that your new refinanced loan will be the first mortgage. In addition, you can only refinance with a VA IRRRL if your new interest rate is lower than your current one.

Unlike other types of mortgage refinances, homeowners don’t always need to verify income or pay for a full property appraisal in order to qualify for a VA IRRRL — which means less paperwork and a faster approval process. If you obtained your original VA-backed loan from another lender, an appraisal may be required.

As with all VA loans, homeowners must pay the VA funding fee — 0.5% of the loan amount — although the VA funding fee may be reduced or waived based on a Veteran’s disability status. For example, you may qualify for exemption if (1) you are a Veteran with a service-connected disability, (2) a servicemember on active duty who received the Purple Heart, or (3) you are the surviving spouse of a Veteran who died in service or from a service-connected disability. Check the VA website for more information.

Today's Mortgage Rates

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*Primarily for Texas homeowners.

Disclaimer: these are sample rates and terms based on daily pricing that fluctuates and is subject to change and credit approval. Parameters: 720+ FICO, Single-Family Residence, $300,000 loan amount, State = NC, County = Wake, Discount Points range from 0.0% to 2.0% as shown above, Admin Fee = $1149. For VA Cash-Out Refinance, assume the borrower is exempt from the VA Funding Fee.

Common Questions

An IRRRL is an easier, faster and less expensive refinancing option that allows qualified military borrowers to take advantage of lower interest rates or shorten the mortgage repayment period.

Note: Refinancing your mortgage may result in higher finance charges over the life of the loan.

To qualify for a VA IRRRL, you must:

  • Be a current or former U.S. military servicemembers with qualified credit
  • Use the IRRRL to refinance your existing VA-backed home loan
  • Verify that you currently live in or previously lived in the home covered by the initial loan

If you have a second mortgage, the holder must agree to be the second mortgage, making your new refinanced loan the first mortgage.

Note: Refinancing your mortgage may result in higher finance charges over the life of the loan.

The first step is to submit your completed loan application. After submission, one of our licensed Military Mortgage Advisors will use your credit and financial information to determine which loan program is best for you. While you can’t get “cash out” with an IRRRL, you may be eligible for a VA Cash-Out Loan at up to 90% of your home’s appraised value.