VA IRRRL: VA Streamline Refinance
Want to save on your VA home loan<5.4.4 va loan>? A Veterans Affairs Interest Rate Reduction Refinance Loan (VA IRRRL) – also known as a VA Streamline Refinance – can help.
What is a VA IRRRL?
Backed by the Department of Veterans Affairs, this loan program offers a simplified process to make refinancing easier and less expensive for Veterans, Active-Duty Service Members, and other eligible borrowers with current VA loans.
What are the benefits of a VA IRRRL?
While the primary purpose of a VA IRRRL is to save money, usually with a lower mortgage interest rate<2.2 mortgage interest rates>, advantages include:
- Getting monthly savings with lower mortgage payments
- Getting stable mortgage payments by changing from an adjustable to a fixed rate
- Paying your loan off sooner by reducing a 30-year loan to a 15-year loan
- Saving over the life of the loan by reducing your interest rate
- Including the costs of refinancing in your new home loan
- Refinancing without an appraisal or credit underwriting
VA IRRRL rates
The most common reason to refinance<3.0 refinance> with an IRRL is to get a lower refinance interest rate<3.2 refinance interest rate>. However, the VA wants to be sure you’re getting a net tangible benefit from the refinance, which means the savings from the loan outweigh the costs of obtaining the loan. Your savings may come from a lower rate, a change from an adjustable rate to a fixed rate, or a shorter loan term. Your loan officer will show you your tangible net benefit before you commit to your loan.
VA IRRRL eligibility
All VA loans have strict eligibility requirements linked to Military Service. Although commonly referred to as VA loans, they are not for Veterans only. Active-Duty Military, Reservists, National Guard Members, and eligible Military Spouses are among those who can take advantage of a VA loan.
A VA IRRRL requires you to:
- Have a VA home loan on the property now
- Provide your Certificate of Eligibility (COE) showing prior use of your entitlement. If you don’t have a COE, we will request it from the VA.
- Agree that the VA IRRRL will replace your existing VA loan as a first lien. Any other lien holders must agree to remain in a subordinate position.
- Live in the home currently, or have lived in it previously
How to get a VA streamline refinance
Here are 5 simple steps to a VA IRRRL:
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1
Contact your CCM loan officer
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2
Fill out a streamlined loan application
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3
Submit a valid Certificate of Eligibility (COE), or ask your loan officer to contact the VA on your behalf
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4
Provide any additional information required by underwriting
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5
Close your new loan
VA IRRRL FAQs
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IRRRL stands for Interest Rate Reduction Refinance Loan. You can use this loan to lower your monthly payments by refinancing to a lower interest rate, stabilize your payments by refinancing from an adjustable rate VA loan to a fixed rate VA loan, or change your loan term.
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No. A VA IRRRL can only be used to refinance an existing VA loan.
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No. That’s one of the streamline features of a VA IRRRL, and may make it easier for you to get loan approval.