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Refinancing a VA Loan

military family

Among the benefits members our armed forces receive for their service is access to the VA loan program, which helps finance homeownership. These loans tend to be more attractive—in terms of rates, credit requirements, down payments, and refinancing—than those available to nonmilitary home buyers.

Lifelong Benefits

Many who used this program to purchase their homes may not realize that they typically can continue accessing it throughout their lives as they buy and sell homes. The VA also offers its borrowers options for managing mortgages through a streamlined refinancing process.

The VA's Interest Rate Reduction Refinancing Loan (IRRRL), which is also referred to as a "Streamline" or "VA to VA" loan, enables borrowers with a VA loan to refinance into a new, lower rate VA loan.

The interest rate on the new VA loan needs to be lower than the one on the current mortgage in order to qualify for this option. The exception is when an adjustable-rate mortgage is refinanced into a fixed-rate loan.

Hassle-Free Refinance

Here are some other benefits to refinancing your current VA loan using an IRRRL.

  • The loan typically bypasses the credit underwriting process.
  • A new appraisal is rarely required.
  • No new money is necessary since associated costs can be included in loan.
  • Additional funds may be borrowed (up to $6,000) for energy-efficiency improvements to the property.
  • A new certificate of eligibility is not required, the one you used previously may be reused.
  • The occupancy requirement is more flexible.
  • Some lenders allow you to reduce your term from 30 years to 15 years.

With interest rates still near historical lows, an IRRRL could help lower your monthly payment further, freeing up funds for other uses for you and your family. The streamlined process for refinancing a VA loan makes it an option you've certainly earned the right to explore.

How low will your payment be?