Refinancing with a VA Loan?

When interest rates are low, many people start looking at refinancing their homes. The Interest Rate Reduction Refinance Loan is a program within the VA loan benefit structure to help veterans take advantage of lower interest rates while still using their VA loan benefits. 

What is an Interest Rate Reduction Refinance Loan (IRRRL)?

You can use the IRRRL program to refinance from one VA loan to another. Or in other words, you can't use it to go from a VA loan to a traditional or a vice versa. You also won't be able to use it to get cash-out refinancing.  

Benefits of an IRRRL loan:

  • You don't have to spend money up front: When you refinance with a traditional loan, there are closing costs and other fees you pay up front. But a lender can give you an interest rate high enough to cover all the costs in an IRRRL. You'll still be paying the fees, but you'll be doing it over time instead of upfront. 
  • You don't need to get an appraisal or credit underwriting package. 
  • You don't  need an additional Certificate of Eligibility.
  • Your occupancy requirement is more lenient: With an IRRRL loan, you'll only need to prove you used to use the home as your primary residence, not that you are doing so now. 

Are you thinking about refinancing? Use our mortgage refinance calculator to see if it makes sense for you.