What is a VA streamline refinance (IRRRL), and do I qualify?

What does an IRRRL do?

It replaces your current VA loan with a new VA loan at a lower rate, or moves you from an adjustable rate to a fixed rate. It's built to be simple:

• Usually no appraisal
• Less income and asset paperwork than a regular refinance
• Closing costs can be rolled into the loan

Do I qualify?

In general:

• You have a VA loan now. An IRRRL only refinances an existing VA loan.
• You've made at least six monthly payments, and your loan is at least 210 days past the first payment due date.
• It gives you a real benefit, like a lower rate or a move from adjustable to fixed.
• The costs pay for themselves within 36 months through your monthly savings. VA requires this.
• You lived in the home at some point. You don't have to live there now.

What does it cost?

• VA funding fee: 0.5% of the loan for an IRRRL, and waived if you receive VA disability compensation.
• Closing costs: usually lower than a regular refinance, since there's often no appraisal. They can be rolled into the loan.
• Our costs: on your Loan Estimate, line by line.

Example scenario (illustrative)

A Navy veteran in Jacksonville has a VA loan at 7.25% from 2023. An IRRRL at a meaningfully lower rate cuts his payment, he's exempt from the funding fee because of his disability rating, and the small closing costs are recouped in well under the 36-month limit. No appraisal, and very little paperwork.

Our take

If you have a VA loan and rates have dropped since you got it, an IRRRL is one of the easiest refinances there is. Be wary of anyone who pitches you repeated IRRRLs just to collect fees; I'll only recommend one when the savings are real.