We’re committed to helping veterans and active-duty service members take full advantage of their VA home loan benefits. One of the most valuable refinancing options available is the VA IRRRL (Interest Rate Reduction Refinance Loan), also known as the VA Streamline Refinance.
This program allows eligible borrowers to refinance their existing VA loan with minimal paperwork— no income verification, employment verification, or appraisal required! Below, we break down the key highlights of the VA IRRRL program to help you determine if it’s the right move for your financial goals.
Key Features of the VA IRRRL
Credit & Eligibility Requirements
- Minimum FICO Score: 550 (even for manufactured homes)
- Credit Report: Only a tri-merge mortgage credit report with scores is required
- Eligible Properties: Primary residences, second homes, and investment properties
Simplified Documentation
- No income verification (employment is listed on the 1003 but not verified)
- Documents Needed:
- Social Security Card (or SSA-89 form if necessary)
- Copy of the existing VA loan Note
- Current mortgage statement
Closing Costs & Fees
Rolling Costs into Loan: Closing costs can be financed into the new loan, but VA has strict rules on fees:
- Lender Fees: If borrower-paid, no more than 1% in non-itemized fees
- Discount Points: Maximum of 2% can be financed
- Escrows Required: Waiving escrows for taxes and insurance is not allowed on VA IRRRLs
Fee Recoupment Rule
- All fees must be recouped within 36 months, whether paid in cash or financed.
VA Funding Fee
- 0.5% for all IRRRLs (regardless of subsequent use)
- Exemptions apply for veterans with VA disability compensation
Seasoning Requirements
The new loan must be dated after the later of:
- The 6th monthly payment on the existing loan OR
- 210 days after the first payment due date on the original loan
Net Tangible Benefit (Rate Reduction Rules)
- Fixed → Fixed: Requires at least 0.5% rate reduction
- Fixed → ARM: Requires 2.0% rate reduction
- ARM → Fixed or ARM → ARM: Exempt from rate reduction
Is a VA IRRRL Right for You?
The VA Streamline Refinance is an excellent option for veterans who want to:
- Lower their interest rate with minimal paperwork
- Reduce monthly payments without income verification
- Refinance quickly, even with a lower credit score
If you’re considering a VA IRRRL, our team at VeteransMortgage.com is here to guide you through the process. Contact us to see how much you could save!
