The VA IRRRL (Interest Rate Reduction Refinancing Loan) program is an ideal solution for Veterans who currently have a VA loan that is at a higher-than-current interest rates.
With interest rates at historical lows (read: ever), most Veterans who have VA loans can realize a significant savings each month on their monthly mortgage payment by participating in the VA IRRRL program.
When participating in the VA IRRRL program, generally, no credit, income or underwriting is required to close the loan automatically with just a few exceptions. One of the most important criteria of the VA IRRRL program is that the new loan must have a lower principal and interest (P&I) than the current loan, unless an ARM is being refinanced, the new loan is a shorter term or energy efficiency improvements are included in the IRRRL.
VA IRRRL Refinance: Can You Finance Closing Costs?
Yes, it is possible to finance the IRRRL closing costs with a VA IRRRL refinance. If the payment increases by 20% or more, the income and debts must be underwritten. A statement showing how long it will take to recoup all closing costs (both included in the new loan and any paid outside of closing) must also be signed by the veteran, acknowledging the effect of refinancing the loan.
VA IRRRL Refinance: What If You Are Currently Late On Your Mortgage?
If you are currently late on your VA loan, it is still possible to refinance under this program but will require pre-approval from the VA. In the case of a delinquent loan refinance, late payments and late charges, plus reasonable costs if legal action has commenced may be added to the loan. In the event that you are currently late and want to participate in the VA IRRRL refinance program, then you must also prove and document your income.
With interest rates at historical lows, it is possible that an IRRRL would help a Veteran save a significant amount of money each month by getting a lower rate. The best way to find out for sure? Complete the form and start working with a VA-approved lender to find out just how much money the IRRRL refinance program can save you.