What is a VA IRRRL, and How Can It Help Me in the Long Run?

My name’s Evan Kaufman, one of your VA loan originators.

The VA IRRRL is called the Interest Rate Reduction Refinance Loan. That’s the long form. Some of us refer to it as a VA Streamline Refinance. Here’s the key: it allows you to do a refinance with no appraisal, no income documentation, and a limited check even on your credit. For example, we can do that in most instances just with a soft pull to make sure you haven’t missed any payments.

So, it’s an incredible program tied to the VA loan that allows you to do a refinance relatively easily. In most states, you’re not getting recharged all the same closing costs that you would have had when you went to purchase the home.

Now, why is this important?

It allows you, as a military member or veteran using a VA loan, to take advantage of rates when they get lower. There are three major things that need to happen, the VA says, for you to be able to do one of these VA IRRRLs:

1. You must wait at least 210 days from the date of your first payment.

   • So, if you bought the home last year, you usually have to wait somewhere around that 7-to-9-month mark, depending on when your first payment hit.

2. Your interest rate must come down by at least 0.5%.

   • Meaning it has to drop by half a percent or more on your interest rate.

3. You must recoup your costs within 36 months.

   • The VA says, “Hey, you lenders like Evan, you guys have to make sure it meets those requirements,” so that it’s a good deal for our military homeowners and worthwhile for them in the long run.

Now, in reality, sometimes it can make sense to do a VA IRRRL, and sometimes it might not. That’s where it’s important to work with us to go over your situation and see if the numbers make sense.

The good news is: we have some really incredible and powerful tools to track your ability to do a VA refinance. Honestly, I haven’t seen tools like these anywhere else — they are really powerful to make sure the refinance actually makes sense for you.

So, hopefully, that explains a little bit more about what the VA IRRRL is — the Interest Rate Reduction Refinance Loan — and how it can benefit you in the long run.

Just imagine: if you could take advantage of lower rates when they occur, relatively easily — you can with a VA loan.

If you have any questions, please feel free to reach out and ask. Take care!