Are you a veteran looking to refinance your mortgage? Below are some VA IRRRL guidelines that will help you keep informed.

An IRRRL (interest rate reduction refinance loan) is a special type of mortgage provided by the US Department of Veterans Affairs (VA) to military families and veterans. VA IRRRL is great as it allows veterans and military families in the US to take advantage of a lower interest rate and maintain the backing and support of the VA in their new mortgage setup. If you are a borrower and are looking to reduce your overall interest costs, you can use an IRRRL in order to refinance to a fifteen-year mortgage from a thirty-year mortgage.

Experts also refer to the IRRRL as the VA Streamline Refinance Program. The VA IRRRL Refinance is an excellent VA-to-VA-loan process and allows owners who already have VA loans to get the following benefits:

• Easily refinance their debt at a considerably lower interest rate
• Shorten the loan term, or
• Convert their ARM (adjustable-rate mortgage) to a fixed-rate mortgage.

VA IRRRL Guidelines

Eligibility Requirements

The following people may qualify for this refinance loan:

• Veterans
• Active duty Service members
• Reserve as well as National Guard members (called to active duty)
• Certain surviving spouses

(READ: What Are the Different Types of FHA Refinance Loans?)

Benefits of VA IRRRL Refinancing

Did you know that compared to most traditional loan refinances, taking advantage of a VA IRRRL is usually faster, easier, and less expensive? All you have to do is meet the most basic VA loan eligibility requirements. After that, the rules and conditions for VA streamline refinances are fairly lax.

Did you know that you do not even need to live in the home in order to qualify for a VA IRRRL? This means that you can use it for refinancing a house you are renting out at the moment. You will only have to certify that you lived there in the past.

No Appraisal

The first benefit of VA IRRRL refinance is that the VA does not require any property appraisal or credit underwriting package. And this could save you hundreds of dollars. However, keep in mind that lenders might require an appraisal and credit report in some circumstances.

No Income Verification

In most cases, there is no need to verify your income as well, which means less paperwork and a much speedier path to approval. Keep in mind that this requirement may vary depending on lender requirements or in cases where your loan payment increases by over 20%.

No Money out of Pocket

Here is another benefit: a VA IRRRL is possible with “no funds out of pocket” as you can include all costs in the new loan, or you can make the new loan at an interest rate that is sufficiently high to enable your mortgage lender to pay the costs. This means borrowers might not need out-of-pocket funds at the time of closing.

Final Thoughts

The IRRRL refinance process does not require a credit check, an appraisal, underwriting, or any upfront closing costs. Therefore, the loans are usually a hassle-free and fast method of refinancing, provided you are eligible.