VA Streamline Refinance for Virginia!!!

Interest Rate Reduction Refinance Loan (IRRRL)

A VA Interest Rate Reduction Refinance Loan (IRRRL) is to lower your interest rate by refinancing your existing VA home loan. By obtaining a lower interest rate, your monthly mortgage payment should decrease. You may also refinance an adjustable rate mortgage (ARM) into a fixed rate mortgage.

IRRRL Facts

• No appraisal or credit underwriting package is required when applying for an IRRRL.
• IRRRL’s may be done with “no money out of pocket” by including all costs in the new loan, you may also opt for the new loan at an interest rate high enough to enable the lender to pay the costs via a lender credit.
• When refinancing from an existing VA ARM loan to a fixed rate loan, the interest rate will probably increase.
• No lender is required to give you an IRRRL, however, any VA lender of your choosing may process your application for an IRRRL.
• You may NOT receive any cash from the loan proceeds.

Eligibility

An IRRRL can only be facilitated in order to refinance a property on which you have already used your VA loan eligibility. It must be a VA to VA refinance, and it will reuse the entitlement you originally used.

Additionally:

• A Certificate of Eligibility (COE) is not required. If you have your Certificate of Eligibility, take it to the lender to show the prior use of your entitlement.
• No loan other than the existing VA loan may be paid from the proceeds of an IRRRL. If you have a second mortgage, the holder must agree to subordinate that lien so that your new VA loan will be a first mortgage. Subordination means the second mortgage holder must agree to be in second place regarding the lien position.
• You may have used your entitlement by obtaining a VA loan when you bought your house, or by substituting your eligibility for that of the seller, if you assumed the loan.
• The occupancy requirement for an IRRRL is different from other VA loans. For an IRRRL you need only certify that you previously occupied the home.

Our Application Process

A new Certificate of Eligibility (COE) is not required. You may take your Certificate of Eligibility to show the prior use of your entitlement or we may use our e-mail confirmation procedure in lieu of a certificate of eligibility.

Loan Limits

VA does not set a cap on how much you can borrow to finance your home. However, there are limits on the amount of liability VA can assume, which usually affects the amount of money you can borrow. The loan limits are the amount a qualified Veteran with full entitlement may be able to borrow without making a down payment. These loan limits vary by county, since the value of a house depends in part on its location. We will be able to tell you what the loan limits are in your area. You may also click this link to see Loan Limits in your county.

VA Funding Fee

Generally, all Veterans using the VA Home Loan Guaranty benefit must pay a funding fee. This reduces the loan’s cost to taxpayers considering that a VA loan requires no down payment and has no monthly mortgage insurance. The funding fee is a percentage of the loan amount which varies based on the type of loan and your military category, if you are a first-time or subsequent loan user, and whether you make a down payment. You have the option to finance the VA funding fee or pay it in cash, but the funding fee must be paid at closing time. You are exempt from this fee if you are a:

• Veteran receiving VA compensation for a service-connected disability, OR
• Veteran who would be entitled to receive compensation for a service-connected disability if you did not receive retirement or active duty pay, OR
• Surviving spouse of a Veteran who died in service or from a service-connected disability.

The funding fee for second time users who do not make a down payment is slightly higher. Also, National Guard and Reserve Veterans pay a slightly higher funding fee percentage.