Just like all mortgage rates, VA rates will fluctuate between highs and lows. When VA mortgage rates are low, it is an especially a good time to take advantage of the VA IRRRL. The VA IRRRL stands for Interest Rate Reduction Refinance Loan, also known as a VA streamline refinance or “VA to VA”.
The IRRRL is guaranteed by the US Department of Veteran Affairs. It is a VA refinance that allows a homeowner to decrease their mortgage payment on an existing VA home loan by lowering the interest rate. In addition, an existing VA Adjustable Rate Mortgage (ARM) can also be refinanced into a VA fixed rate loan with the VA IRRRL.
A specific requirement for the IRRRL is that the monthly mortgage payment on the new loan must be lower than the payment on the old loan. This is easily accomplished when VA mortgage rates have gone down. The exception to this is when refinancing from an ARM into a fixed rate loan.
Specifics and Benefits of an IRRRL
– An IRRRL does not require an appraisal which can significantly speed up the refinance process.
– There are usually no out of pockets expenses to the homeowner since all costs can be included in the new loan.
– Since the IRRRL is a streamline refinance product, the borrower may not take cash out from the loan proceeds.
– The borrower must be current on their mortgage and have no more than one 30 day late payment within the previous 12 months.
– The borrower does not have to live on the property in order to refinance with the IRRRL, but must certify that they occupied the home at one time.
– The IRRRL is a VA to VA loan which means that the borrower’s eligibility has already been used on the property being refinanced. There is no need to prove eligibility again.
– The funding fee on the IRRRL is lower than the original funding fee.
– With the IRRRL or any VA loan, there are no monthly mortgage insurance payments.
– Cash out for energy efficient improvements are allowed with the IRRRL.
– The borrower can use any VA lender for the IRRRL. Since shopping around for competitive VA rates is common, most borrowers will use an online VA lender which saves the borrower a lot of time.
The VA offers the VA IRRRL streamline refinance because the original loan is already guaranteed and your payment history is already on record which makes it a low risk loan. When VA mortgage rates are low, it is the perfect time for a homeowner to use the VA IRRRL to enjoy the many benefits it has to offer.
Find out how you can save money each month by refinancing with a VA IRRRL. Feel free at any time to contact me for more information about the VA Streamline Refinance – IRRRL and how you can benefit from refinancing now when VA mortgage rates are low.
My loan process was very easy and quick. Not to mention a great loan rate. I couldn't be happier!
Capt Sam T. - US Army
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