How do I Qualify for a VA IRRRL?
Qualifying for the VA IRRRL program basically has two main factors. If you are a current homeowner that used your VA benefits to purchase your home chances are, if you qualified for a VA loan in the first place, then you are qualified for the IRRRL VA refinance. That being said there are a few exceptions to this, and requirements can vary, but generally speaking, that is the case. The second factor is your current situation. If the IRRRL benefits your current situation and it makes sense then there is usually no problem. If the Interest Rate Reduction Refinance Loan is something that you would like to consider the best thing to do is call (855) 956-4040 to talk to a VA loans specialist.If you’ve gotten married since you got your VA loan, and are wanting to add your new spouse as an obligor on the loan, you may be able to use an IRRRL to do so but it will at least need to be submitted for prior approval to the VA, and will not be nearly as “streamlined” as it would be otherwise. The same is true for a divorce where one or more of the obligors are getting taken off the loan. In cases of joint VA loans where the obligors change, an IRRRL is usually not possible. This is one way that your situation can disqualify you from being able to use an IRRRL to refinance your loan. In these cases, you will need to use a standard refinance to update your mortgage. A change of obligors is not the only situational variable that affects your ability to use an IRRRL.
The VA requires that an IRRRL results in a net benefit to the borrower. They require that your interest rate must lower as a result of the IRRRL unless you are going from an ARM to a fixed-rate mortgage. ARM loan interest rates are calculated differently, and are often lower than their fixed-rate counterparts. The VA also requires that your principal and interest payment becomes lower (which usually happens by default when the interest rate lowers), or the remaining term on the loan must decrease. Even if you secure a lower interest rate, your payment might get higher if you choose a shorter term, since you’re paying off more principal each month.