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What is an IRRRL?

VA Interest Rate Reduction Refinance Loan, commonly referred to as an IRRRL, is designed for Veterans to refinance their existing VA loan to a lower rate and reduce their monthly payment.

Veterans and Servicemembers have earned a valuable benefit – the right to apply for a VA mortgage. Within the VA loan program, there is a special loan product for Veterans who want to lower their monthly payments. Commonly referred to as an IRRRL, VA-to-VA, or Streamline loan, the IRRRL program helps Veterans who currently have a VA loan refinance to a lower interest rate.

This VA program can save Veterans tens of thousands of dollars over the life of the loan. IRRRL loans are typically utilized by Veterans to refinance an existing VA mortgage and reduce their interest rates. A lower interest rate means a lower monthly payment and less interest paid over the loan term. A lower monthly payment means more cash in your pocket for your family and home. The IRRRL program can also be used to refinance an existing VA guaranteed adjustable rate mortgage (ARM) into a fixed rate mortgage.

With today’s mortgage rates reaching near record lows, a VA Interest Rate Reduction Refinance Loan could be right for you.

Easy to Qualify

The VA IRRRL program is designed for Veterans who have already qualified for a VA loan. As long as you make your VA mortgage payments on time, you can qualify for an IRRRL.   

  • No Income Verification

    In most states, there is no income verification required for the VA IRRRL program Veterans that are in a current VA loan can streamline their loan without being required to provide paystubs or bank statements. Less documentation means less stress during the refinance process.

  • No Appraisal
    Another great benefit for Veterans looking to take advantage of the VA IRRRL program is that the VA does not require an appraisal. It is important to note that some lenders may still require an appraisal. However, NewDay USA doesn’t require an appraisal, which means that you can close your loan more quickly and start enjoying the benefits of a lower monthly payment even sooner. This is good news for Veterans and makes the process of refinancing that much easier!

Eligibility Requirements

In order to refinance an existing VA loan using the IRRRL program, you must meet general eligibility guidelines.

  • The new loan sum may not exceed the outstanding balance of the original VA loan.
  • Must be refinancing an existing VA loan.
  • Must have made 6 on-time payments on current VA loan.
  • Borrower must not receive any cash from the refinance.

If you are a Veteran looking to refinance your mortgage and get cash out, the VA Cash Out Refinance Program might be a good fit for you. It lets you borrow up to 100% of your home’s value, including mortgage balance. You can use that money to consolidate your debt and lower your monthly payment by hundreds.

Lower Monthly Payment Means More Cash in the Bank

  • No Points Required

    Discount points are upfront fees that a borrower can pay to buy down their interest rate. With the VA IRRRL program, Veterans are not required to pay such fees associated with discount points and can still lower their rate. However, lenders may charge discount points if the borrower would like a further rate reduction in the VA IRRRL program.

  • VA IRRRL Rates
    A lower interest rate saves you money every month. That money adds up—after refinancing into a VA IRRRL, you can potentially save tens of thousands of dollars over the life of the loan. With a VA IRRRL, your interest rate is guaranteed to decrease, unless you’re refinancing from an adjustable rate mortgage into a fixed rate mortgage. 

Mortgage rates have dropped to near record lows, so now is the perfect time to explore your refinance options. A lower rate means lower payments, and every Veteran deserves to be able to put money in the bank each month.

VA IRRRL Funding Fee – Only 0.5%

Just like other VA loans, the VA requires Veterans to pay an up-front funding fee. However, compared to a purchase loan or a cash out refinance, IRRRLs require a much smaller funding fee. With an IRRRL, you will only have to pay a funding fee of 0.5 percent of the loan amount. On a $150,000 loan, for example, the funding fee comes out to only $750. Please visit the VA’s funding fee chart for more information.

Call Today to Learn More

Considering your refinance options and looking to lower your monthly payment? A VA IRRRL could be a great program for you. With NewDay USA, your personal Account Executive will guide you every step of the way through the quick and easy loan process. If you or someone you know is interested in an IRRRL, please give NewDay USA a call at 800-405-4187 OR get started online today!