One of the many benefits veterans and current service members have is a special mortgage program through the VA. The VA also offers a refinance program for those same service members. The VA streamline Refinance or also known as the IRRRL. The VA loan offers simple qualifying terms, low rates, and minimal equity. VA loans don’t require the borrower to pay mortgage insurance or PMI. When buying a new home qualified military members don’t need to put down a down payment when they use the VA home loan.
If you’re looking to refinance your existing VA home loan you don’t have to give up your loan benefits. The VA or IRRRL (interest rate reduction refinance loan) also known as the VA Streamline refinance, lets borrowers refinance their VA loan into a new one. Streamline loans usually will have less paperwork and have easier credit requirements than the original loan.
VA IRRRL: The Basics
Also known as a VA-to-VA loan, the VA IRRRL was designed to let military members who already have an existing VA home loan refinance their current loan into a new one and either lowering your interest rate, transition from an adjustable-rate loan to a fixed-rate loan, or both. VA IRRRLs were designed to be easy and quick.
Requirements for an IRRRL Straight From the VA
When using the VA streamline refinance program, you don’t need to have your COE like you did for the original loan. Since it is a requirement to have it for your initial mortgage it’s carried over into your IRRRL refinance loan. Disabled veterans could also qualify for a VA funding fee waiver and won’t have to pay the funding fee.
VA IRRRL: Loan Terms
The IRRRL is only available to those who are refinancing an existing VA home loan. You can’t use the IRRRL for an FHA or other conventional loan. The IRRRL is available with fixed rates and you can choose whether your loan term be for 10 years up to 30 years. Thanks to the IRRRL being backed by the VA you can take advantage of rolling all of your closing costs into your new loan
Approved VA IRRRL Lender
The VA will never limit your choice of lenders, as long as the lender is VA approved. You don’t have to use your current mortgage provider either if you don’t want to. It’s always a good idea to use a lender that has extensive experience with the VA IRRRL Program. As these guidelines can change and frequently it’s important to find a lender who is knowledgeable with the VA IRRRL program and someone who knows the ins and outs.
* By refinancing your existing loan, your total finance charges may be higher over the life of the loan.