In this article, we will explore the IRRRL program pros and cons. The VA IRRRL is also known as the streamline refinance. IRRRL stands for Interest Rate Reduction Refinance Loan.
The VA Interest Rate Reduction Refinance Loan (IRRRL) is a program offered by the Department of Veterans Affairs (VA) that allows military veterans and their families to refinance their existing VA home loans at a lower interest rate.
There are a lot of benefits associated with the VA IRRRL program. Some of these benefits come hand in hand with it simply because it is a “streamline”. Other benefits come from the specific policies and terms the VA has in place to make the streamline refinance a more attractive option for veteran borrowers. While there are many pros to the IRRRL, there are also a few cons or situations it may not be appropriate. We will go over the IRRRL program pros and cons however in this article we will focus a little more on the IRRRL benefits.
- Save money by lowering your interest rate
- In most cases no appraisal is required
- Employment proof is usually not needed
- No dept to income verification
- No minimum FICO score check
- Change your loan terms
- Faster closing times
- Option to defer two months of mortgage payments
- Usually keep your escrow refund
- No cash due at closing
- Not enough net tangible benefit
- No cash back, however you might want to consider the VA cash out refinance option if you would like to tap into the equity of your home.
- As with any loan there are closing costs
VA IRRRL Program FAQ’s
Here are some frequently asked questions about the VA IRRRL program:
- Be a military veteran with a VA home loan.
- Have a current VA home loan that you want to refinance.
- Certify that you have lived in the home as your primary residence for at least six months before applying for the IRRRL.
To apply for the VA IRRRL program, you will need to:
- Gather all of your financial and personal documents, including your most recent mortgage statement, proof of income, and proof of insurance.
- Find a VA-approved lender and submit your application and supporting documents.
- Wait for the lender to review your application and provide you with a loan estimate.
- Review the loan estimate and decide whether to move forward with the loan.
- If you decide to move forward, the lender will process the loan and schedule a closing date.